On November 19, the House Financial Services Subcommittee on Housing, Insurance and Community Development held a hearing entitled, “Insuring Against a Pandemic: Challenges and Solutions for Policyholders and Insurers.” This follows a September Congressional Roundtable that PIA National participated in, where we expressed our support for the Pandemic Risk Insurance Act (PRIA), H.R. 7011.
In preparation for the hearing, PIA National submitted testimony for the record in which we reiterated our position that a public-private partnership is the best way to protect businesses from the financial effect of a future pandemic. In our testimony, PIA National laid out our guiding principles for future pandemic proposals:
- Public-Private Partnership: PIA National envisions a federal government backstop in the form of a public-private partnership. PIA National supports PRIA, and we are open to improvements that will maximize its benefits for both industry and policyholders.
- Affordability for Small Businesses: A legislative solution must be affordable for small businesses.
- Utilization of Existing Insurance Framework: PIA members prefer to work within the framework of the insurance industry. We are concerned about proposals that would require insurance agents to deliver a non-insurance product to consumers.
- Focused on the Future: Proposals should be future-focused, allowing businesses to budget for it and make considered, informed decisions about their participation. This is one reason we strongly oppose any proposal that would retroactively rewrite existing business interruption (BI) provisions.
PIA National believes the PRIA legislation introduced by Rep. Carolyn Maloney (D-NY) should serve as a template for action on this issue. We support building upon the PRIA bill by incorporating thoughtful provisions from other proposals, particularly those that would ensure the affordability and thus the participation of small businesses.
At the same time, we are hesitant to embrace a non-insurance product that relies on independent insurance agents, who prefer to work within the framework of insurance.
PIA National and its members look forward to continuing to work with policymakers on this important issue.