ASAE Voices Support for Pandemic Risk Insurance Act
The legislation will create the Pandemic Risk Reinsurance Program, a system of shared public and private compensation for business interruption losses resulting from future pandemics or public health emergencies.
ASAE endorsed a bill introduced by Rep. Carolyn Maloney (D-NY) on November 2 to create a federal backstop that will help cover losses resulting from a future pandemic or public health emergency.
The Pandemic Risk Insurance Act (PRIA) of 2021 [PDF] directs insurers to provide pandemic coverage for event-cancellation losses—which is vital to the association community—among other important provisions.
“Millions of small businesses, nonprofits, associations, and event companies across the country were left in the cold during the coronavirus pandemic, through no fault of their own,” Maloney said. “A public-private framework would ensure our insurance markets serve these businesses in the next pandemic, and I am proud to sponsor the Pandemic Risk Insurance Act to provide these important protections. I want to thank ASAE for its support of PRIA and for working with me to move this solution forward.”
Maloney first introduced PRIA last year, but made some key changes to increase the likelihood of bipartisan support. The new bill still calls for the government to absorb 95 percent of claims in the future, but business interruption coverage would change to a model known as “parametric.” This new model is similar to coverage offered by the Paycheck Protection Program but, instead of receiving a loan or grant, policyholders would pay a premium for access to expedited funds that cover up to six months of eligible fixed costs, such as salaries and mortgage.
“ASAE is proud to support Congresswoman Maloney’s and her invaluable Pandemic Risk Insurance Act,” said ASAE President and CEO Michelle Mason, FASAE, CAE, in a press release. “ASAE has long supported efforts to help fully reestablish our economy, and PRIA will help us get there. PRIA’s coverage for event cancellation is especially critical to our association community whose lifeblood courses from in-person events of all sizes and scope. ASAE thanks and applauds Rep. Maloney for introducing this important bill, which will no doubt help provide associations the security they need to fully reignite our community’s far-reaching economic impact through industry-focused conferences and events, among other crucial services.”
ASAE has called for a pandemic risk insurance solution since March 2020 [PDF]. In addition, ASAE joined the Business Continuity Coalition (BCC) in May 2021, which represents a broad range of business insurance policyholders and works constructively with policymakers and other U.S. stakeholders to develop programs that protect jobs, associations, and businesses amid major public health emergencies. The BCC has also endorsed Maloney’s new version of PRIA.
(Pixelimage/iStock/Getty Images Plus)