Renewed Call for Government Reinsurance Backstop

This is exactly why policymakers need to step in and create a government reinsurance backstop for viral pandemics as well as other rare but catastrophic events. Trying to retroactively insert pandemic insurance into business interruption contracts — which specifically excluded these risks — won’t work. Especially since the total surplus for auto, home, and business insurers in the U.S. is roughly $800 billion, while COVID-19 losses will run into the trillions.

By the way, putting in place a government reinsurance backstop for viral pandemics will help stimulate the economy today — by giving business owners and lenders the confidence to start back up, and to scale.

Small businesses band together to sue insurers over coronavirus damage