The National Retail Federation welcomed the introduction of the Pandemic Risk Insurance Act, which would establish a federal program to help businesses obtain insurance coverage for pandemics modeled on a system for terrorism insurance established following 9/11.
“Congress must take swift action on a solution to provide all businesses protection against future pandemic risks,” NRF Vice President for Government Relations, Banking and Financial Services Leon Buck said. “The development of a public-private partnership to address this risk will provide certainty for businesses and organizations of all sizes and will ensure that we can meet future pandemic events with greater resilience.”
“This legislation is the cornerstone of a proactive approach in managing the risk and impact of a pandemic or epidemic in the future,” Buck said.
Buck spoke as part of a virtual news conference held today by House Financial Services Committee member Representative Carolyn Maloney (D-N.Y.), to announce the introduction of the Pandemic Risk Insurance Act.
Developed with input from NRF, the legislation is modeled on the Terrorism Risk Insurance Act, which was enacted after the attacks of Sept. 11, 2001, made it difficult for businesses to obtain insurance coverage against acts of terrorism.
The new measure would require that insurance companies offer policies that cover pandemics but would create a federal backstop program that would reimburse insurers when claims related to a pandemic or epidemic exceed $250 million nationwide. Covered businesses would have to demonstrate that they had suffered significant business interruption with a sharp decline in revenue. Coverage would also be required for large gatherings, ranging from sporting events to concerts to conventions, that are canceled. The program would cover only future pandemics, not claims from the current COVID-19 pandemic, and would be capped at $750 billion.
NRF believes coverage against pandemics is crucial as retailers seek to renew leases, invest in real estate, order inventory, plan for capital improvements and hire or re-hire workers in coming months.