Rhode Island Senate Bill S0367

Rhode Island 2023 Regular Session

• Introduced: 2/16/23
• Refer: 2/16/23

Caption

Covid-19 Pandemic Insurance Recovery Act

Impact

The implementation of this act would significantly impact Rhode Island's insurance landscape by requiring insurers to cover pandemic-related business interruptions as part of their policies. The bill mandates that each policy in force at the specified date must include coverage for losses linked to global virus transmission, thereby broadening the standard definitions of covered perils under such insurance. This legislative move is expected to provide much-needed financial relief to small businesses that struggled during the height of pandemic restrictions.

Summary

Senate Bill S0367, known as the COVID-19 Pandemic Insurance Recovery Act, aims to assist businesses adversely affected by the COVID-19 pandemic by facilitating their recovery of losses through business interruption insurance. The act stipulates that any business that had an active business interruption insurance policy on March 9, 2020, is entitled to claim losses incurred due to disruptions caused by the pandemic. This provision is particularly aimed at small businesses with less than 100 employees, as defined by the eligibility criteria in the bill.

Contention

While the bill has the potential for positive economic impact, it also raises questions and concerns among stakeholders. Insurers are likely to contest the implications of retroactively adding pandemic coverage to existing policies, fearing burdening their financial frameworks. Additionally, all necessary checks and protocols for submitting claims must be established to prevent fraudulent activities, prompting debate on the measures that will be put in place by the insurance commissioner. The balance between ensuring rapid recovery for businesses and protecting insurers' interests is a key point of contention surrounding the bill.