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PIA Supports New Recovery Fund for Businesses

In response to COVID-19
March 31, 2020

WASHINGTON -- The National Association of Professional Insurance Agents (PIA National) has helped develop a new recovery fund for businesses hit hard by the coronavirus crisis. Along with other insurance trade associations like the Reinsurance Association of American (RAA), PIA National has helped develop a common sense solution for struggling businesses.

The proposal creates a Business Continuity and Employee Protection and Recovery Fund within the U.S. Department of the Treasury. The Fund is modeled after the September 11th Victim Compensation Fund, operated by the federal government and run by a presidential appointee with the authority to enter into contracts with interested businesses to administer the Fund and facilitate the distribution of federal funds to affected businesses.

The Fund is meant to protect lost wages for employees unable to work because of COVID, preserve jobs through payroll assistance for closed businesses that continue to retain their employees, and prevent businesses from insolvency.

“PIA has always been about providing solutions to problems in a proactive way, more than ever during this difficult time,” said Mike Becker, executive vice president and CEO of PIA National. “To that end, we’ve worked with our industry partners to develop a solution for businesses that have been hard hit by the negative economic consequences related to the coronavirus, while not upending insurance practices.”

Policymakers in states and at the federal level have begun floating a requirement for insurers to retroactively recognize financial losses triggered by the coronavirus outbreak as part of their customers’ business interruption coverage. PIA National believes such actions to be shortsighted.

“During times of crisis it is understandable that policymakers who are trying to help sometimes make rash proposals that have ramifications they don’t quite understand, which would harm both industry and policyholders in the long term,” Becker said. “Rather than a defensive response, PIA has instead helped create a positive alternative for these struggling businesses that doesn’t upend existing insurance contracts and practices.”

PIA and its allies are aiming to have this legislation in the next bill meant to provide help for the U.S. economy during the coronavirus.

“PIA is already working with congressional allies to include this proposal in the next round of coronavirus legislation. We hope Congress acts on this sensible solution to a serious problem,” Becker concluded.

Founded in 1931, PIA is a national trade association that represents member insurance agents and their employees who sell and service all kinds of insurance but specialize in coverage of automobiles, homes and businesses. PIA’s web address is www.pianet.com

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