The U.S. insurance industry is promoting the idea of an insurance plan backed by the federal government that would help businesses that in the future suffer losses from a pandemic, people familiar with the effort told Reuters.
The campaign involves discussions with lawmakers and regulators, public statements and coordination with a broad coalition of non-insurance companies including retailers, hoteliers and booksellers, sources said.
Insurers are doing this after facing multiple lawsuits, fierce political pressure and criticism from customers with business interruption policies over not covering their recent financial hardships due to the novel coronavirus pandemic.
About 40% of small businesses have business interruption coverage, according to the Insurance Information Institute, an industry trade group.
While these policies may cover revenue losses from hurricane damage, lightning strikes or cars crashing into buildings, they either exclude or do not specifically cover a global pandemic, however much it may interrupt business.
U.S. insurers say they would not have the financial means to help every insured business affected by coronavirus, even if required to.
“The industry doesn’t have as much money available for new claims as people would tend to think,” said Steven Weisbart, chief economist for the Insurance Information Institute………..Read More>>