I 

116TH CONGRESS 

2D SESSION H. R. 7412 

To establish a temporary voluntary program for support of insurers providing 

business interruption insurance coverage during the COVID-19 pandemic, 

and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JUNE 29, 2020 

Mr. THOMPSON of California introduced the following bill; which was referred 

to the Committee on Financial Services 

A BILL 

To establish a temporary voluntary program for support of 

insurers providing business interruption insurance coverage during the COVID-19 pandemic, and for other 

purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Business Interruption 

5 Relief Act of 2020’’. 

6 SEC. 2. FINDINGS AND PURPOSES. 

7 (a) FINDINGS.—The Congress finds that— 


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1 (1) mandatory civil authority shutdowns as a 

2 result of the coronarvirus disease 2019 (COVID-19) 

3 have adversely impacted businesses throughout the 

4 United States; 

5 (2) the American economy relies in part upon 

6 an investment in and expectation of insurance bene7 fits that back business assets and the workforce; 

8 (3) many businesses have paid policy premiums 

9 for business interruption coverage and, in particular, 

10 for coverage for civil authority shutdowns of busi11 nesses; 

12 (4) many businesses that purchased business 

13 interruption coverage and coverage for civil author14 ity shutdowns did so in the expectation that insur15 ance would protect a temporary shutdown of their 

16 workforce, prevent layoffs and furloughs, and allow 

17 an orderly restart of operations; and 

18 (5) State laws mandate an orderly and prompt 

19 payment of first party insurance claims and insurers 

20 have claim management resources with the expertise 

21 and skills to timely manage claims payment and dis22 tribution of funds according to expected and relied 

23 upon guidelines and procedures that policyholders 

24 had the expectation to receive. 

25 (b) PURPOSES.—The purposes of this Act are— 


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1 (1) to establish a program to encourage and 

2 provide support for insurers who timely pay claims 

3 under business interruption coverage to policyholders 

4 adversely affected by civil authority shutdowns re5 sulting from the COVID-19 pandemic; and 

6 (2) to establish the program in a manner that 

7 ensures that— 

8 (A) carriers that sold policies that cover 

9 business interruption losses for COVID-19 do 

10 not receive any Federal windfall; and 

11 (B) carriers that sold policies that ex12 pressly exclude coverage for a virus or pan13 demic for COVID-19 can avoid costly litigation 

14 with policyholders, and policyholders may re15 ceive policy benefits to compensate for govern16 ment shutdown and business interruption. 

17 SEC. 3. PUBLIC/PRIVATE PARTNERSHIP BUSINESS INTER18 RUPTION INSURANCE RELIEF PROGRAM FOR 

19 COVID-19. 

20 (a) ESTABLISHMENT.—There is established in the 

21 Department of the Treasury the Business Interruption 

22 Relief Program. 

23 (b) VOLUNTARY.—Participation in the Program on 

24 the part of an insurer shall be voluntary at the option of 

25 the insurer. 


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1 (c) ELIGIBLE POLICIES.—To be eligible to partici2 pate in the Program, an insurer shall have, as of the date 

3 of initial participation in the Program, one or more out4 standing and existing policies of insurance issued to a pol5 icyholder for business interruption insurance coverage 

6 that— 

7 (1) expressly include coverage for losses during 

8 any period of time that any civil authority shutdown 

9 as a result of the COVID-19 pandemic is in effect; 

10 and 

11 (2) expressly exclude coverage for a ‘‘virus’’. 

12 (d) ASSISTANCE.— 

13 (1) REIMBURSEMENT FOR PAYMENT OF

14 CLAIMS.—Under the Program, the Secretary shall 

15 provide financial assistance to reimburse any partici16 pating insurer that voluntarily pays benefits under 

17 an eligible policy for COVID-19 losses, thereby 

18 waiving the exclusion referred to in subsection 

19 (c)(2), in the amount of— 

20 (A) the benefit to be paid in accordance 

21 with all terms of the policy; plus 

22 (B) any expenses incurred by the partici23 pating insurer relating to paying such claim. 

24 (2) PROHIBITION.—The Program shall provide 

25 no benefit or reimbursement for an insurer’s payVerDate Sep 11 2014 22:20 Jul 23, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H7412.IH H7412

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1 ment and claim expenses for benefits paid under any 

2 policy for business interruption coverage that does 

3 not expressly exclude coverage for a ‘‘virus’’. 

4 (3) TREATMENT OF RIGHTS AND DUTIES.— 

5 (A) POLICYHOLDERS.—Policyholders 

6 under policies for which reimbursement is pro7 vided under the Program shall retain all first 

8 party rights to policies for business interruption 

9 insurance coverage. 

10 (B) STATE LAW.—Participation in the 

11 Program by an insurer shall not supersede or 

12 replace any rights of good faith and fair duty 

13 under State insurance law. 

14 (4) COMPLIANCE.—The Secretary shall take 

15 any such actions as may be necessary, before pro16 viding any assistance pursuant to paragraph (1) to 

17 a participating insurer, that the participating in18 surer makes payment to policyholders in compliance 

19 with the terms and conditions of the policies referred 

20 to in subsection (c). 

21 (e) LIMITATION ON ASSISTANCE FOR A PARTICI22 PATING INSURER.—The Secretary shall limit the amount 

23 of assistance provided for a participating insurer under 

24 the Program under this section according to the limits of 

25 the eligible policies involved. 


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1 (f) DEFINITIONS.—For purposes of this section, the 

2 following definitions shall apply: 

3 (1) BUSINESS INTERRUPTION INSURANCE COV4 ERAGE.—The term ‘‘business interruption insurance 

5 coverage’’ means property and casualty insurance 

6 coverage provided or made available for losses result7 ing from periods of suspended business operations, 

8 whether provided under broader coverage or sepa9 rately. 

10 (2) CIVIL AUTHORITY SHUTDOWN.—The term 

11 ‘‘civil authority shutdown’’ means forced closure of 

12 businesses, or evacuation, by mandate, law, or order 

13 of any State or local government or governmental of14 ficer or agency. 

15 (3) COVID-19 LOSSES.—The term ‘‘COVID-19 

16 losses’’ means for losses resulting from business 

17 interruption due to a civil authority shutdown as a 

18 result of the COVID-19 pandemic. 

19 (4) ELIGIBLE POLICY.—The term ‘‘eligible pol20 icy’’ means a policy for business interruption insur21 ance coverage described in section 3(c). 

22 (5) INSURER.—The term ‘‘insurer’’ has the 

23 meaning given such term in section 102 of the Ter24 rorism Risk Insurance Act of 2002 (15 U.S.C. 6701 

25 note). 


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1 (6) PARTICIPATING INSURER.—The term ‘‘par2 ticipating insurer’’ means an insurer that— 

3 (A) has voluntarily elected, in accordance 

4 with such procedures and requirements as the 

5 Secretary shall establish, to participate in the 

6 Program; and 

7 (B) is in compliance with the requirements 

8 under this section for participation in the Pro9 gram. 

10 (7) PROGRAM.—The term ‘‘Program’’ means 

11 the Business Interruption Relief Program estab12 lished under this section. 

13 (g) REGULATIONS.—The Secretary shall issue any 

14 regulations necessary to carry out the Program. 

15 (h) FUNDING.—There is authorized to be appro16 priated such sums as may be necessary for providing fi17 nancial assistance under the Program to participating in18 surers. 

Æ 


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