An Insurance Journal article estimates that business interruption losses from the coronavirus just for small businesses in the U.S. could be as much as $383 billion per month, or 50 percent of the total available for the industry to pay all claims.
According to American Property Casualty Insurance Association (APCIA), that is 10 times the most claims ever handled by the industry in one year. The industry processed more than three million from the 2005 hurricane season that included Hurricanes Katrina, Rita, Wilma and several other storms, the trade group said.
APCIA president and CEO David Sampson said the coronavirus loss estimate assumes as many as 30 million claims would be filed by small businesses that suffered losses from the pandemic.
While the industry has little business interruption coverage to offer for the pandemic, Sampson said the APCIA is willing to discuss “forward-looking answers that speed economic recovery from future pandemics” with lawmakers.
Insurers back COVID-19 fund
The Insurance Journal further reports that a coalition of 36 business groups, including the insurance sector, has sent the Trump administration and Congressional leaders a letter expressing support for a proposed COVID-19 Business and Employee Continuity and Recovery Fund, a new federal relief fund intended to help businesses and workers suffering losses from coronavirus pandemic shutdowns. The fund aims to help businesses retain and rehire workers, maintain employee benefits, and pay such operating expenses as rent. It also may provide money for payroll, lost income of sick employees, and lost business revenues.
Insurers and other businesses would help create a process for quickly reviewing and processing applications filed by companies seeking help. The relief fund would be managed by a special administrator within the Treasury.
Insurers may need 90-day-rule relief for COVID-19 premium grace periods