House Committee Announces Hearing on Pandemic Risk Insurance

October 27 Chairwoman Maxine Waters (D-CA) of the House Committee on Financial Services announced that the Subcommittee on Housing, Community Development, and Insurance would be holding a hearing on November 19 entitled “Insuring against a Pandemic: Challenges and Solutions for Policyholders and Insurers.” At the hearing, the Subcommittee is expected to discuss IWLA-supported legislation, Rep. Carolyn Maloney’s (D-NY) H.R.7011, the Pandemic Risk Insurance Act (PRIA).

The bill would create a Pandemic Risk Reinsurance Program that would establish a system of shared public and private compensation for business interruption losses resulting from future pandemics or public health emergencies (section-by-section summary). PRIA is modeled on the successful Terrorism Risk Insurance Act (TRIA), which has been integral in encouraging insurers to cover acts of terrorism, which is similarly challenging to insure. The Pandemic Risk Reinsurance Program that would be created under H.R.7011 allows for the flexibility for insurers to participate instead of being a mandatory program. This flexibility will protect policyholders from mandatory costs and expenses being passed down, as could be the case in a “one-size-fits-all” proposal.

IWLA endorsed H.R.7011 in a June 2 letter and is closely working with the bill sponsor to generate additional support for the legislation on Capitol Hill.

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