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Thompson Announces Introduction of Business Interruption Relief Act

June 30, 2020

Bill allows interruption insurance claims to be honored during shutdowns such as those due to Coronavirus

Washington – Today Rep. Mike Thompson (CA-05) announced that he has introduced H.R. 7412, the Business Interruption Relief Act of 2020. This bill will help sort through the confusion facing many businesses that closed due to the Coronavirus pandemic by creating a voluntary program that would reimburse insurers who voluntarily pay out business interruption claims. This program would support small businesses that have been hit hard by shutdowns due to Coronavirus.

"So many businesses in our district and across our nation have been forced to temporarily close their doors to help keep employees and customers safe during the Coronavirus-related shutdowns. And when those businesses have filed claims under previously-purchased business interruption insurance, they are often having difficulty getting those claims honored. This leads to confusion and a tough economic hit for businesses that are already struggling," said Thompson. "That's why I introduced the Business Interruption Relief Act, a bill to help businesses get their claims honored, cut through the red tape of litigation, and support our economic recovery. We have to help the businesses who are working hard to follow local guidance and keep their doors open in the long term."

The Coronavirus pandemic and related quarantine and shutdown measures have created confusion and uncertainty for many businesses that have purchased business interruption insurance. Specifically, many business interruption policies simultaneously cover costs incurred due to civil authority shutdowns while excluding costs stemming from viruses. This creates a gray area for businesses, many of whom would have to take insurers to court to receive any payout.

Thompson's Business Interruption Relief Act would create a voluntary program for insurers, in which insurers can choose to pay out claims to these businesses and be reimbursed by the federal government. This would simultaneously provide a boost to businesses of all sizes with business interruption insurance coverage and prevent potentially years of costly litigation. Eligible businesses would be limited to those with (a) business interruption insurance that (b) includes civil authority shutdowns but (c) excludes virus-related damages. You can click here to read the text of the bill.

Congressman Mike Thompson is proud to represent California's 5th Congressional District, which includes all or part of Contra Costa, Lake, Napa, Solano and Sonoma Counties. He is a senior member of the House Committee on Ways and Means where he chairs the Subcommittee on Select Revenue Measures. Rep. Thompson is Chairman of the House Gun Violence Prevention Task Force. He is also Co-Chair of the bipartisan, bicameral Congressional Wine Caucus and a member of the fiscally-conservative Blue Dog Coalition.