Know This About Business Interruption Insurance And A Federal Backstop During The Pandemic

During this time of crisis, officials in the banking and insurance industries are working hard to figure out the best ways to help companies find additional resources. As $2 trillion in federal relief was quickly exhausted, as many as 26 million people filed for unemployment. There are immediate needs to keep businesses afloat during this unpredictable time. Many companies in the travel, hospitality, food and beverage, and oil and gas industries are looking to their insurance policies for a solution, and national lawmakers are considering a plan to create a backstop for the insurance industry to protect businesses from filing bankruptcy and recoup lost revenue.

The viewpoint from the insurance sector is complicated. Some states have mandated temporary refunds on auto premiums and worker’s compensation insurance. Recent filing of lawsuits against carriers have also skyrocketed. Is this sustainable for the industry? The debates on both sides are ongoing, but the overall message is increasingly clear — something must be done.