On November 2, 2021, New York Congresswoman Carolyn Maloney reintroduced the Pandemic Risk Insurance Act (“PRIA”) in the U.S. House of Representatives.  PRIA would create the Pandemic Risk Reinsurance Program (the “Program”), a shared public-private system that would require insurers to offer coverage in all commercial property and casualty lines of insurance for insured losses resulting from public health emergencies or future pandemics.  Insurance lines that would fall within the scope of the Program include commercial lines of property and casualty insurance, including excess insurance, workers’ compensation insurance, business interruption insurance, commercial general liability insurance, directors and officers liability insurance, and event cancellation insurance.

In addition, PRIA would also require insurers to make available in all commercial property insurance policies a parametric non-damage business interruption insurance coverage for insured losses resulting from public health emergencies or future pandemics.  This would require insurers to compensate insured businesses for a portion of 180 days’ fixed costs and payroll.  However, insurers would have the option to arrange for parametric non-damage business interruption coverage through either an affiliate insurer or a parametric insurance facility in which the insurer participates.

The federal government, however, would provide a backstop, sharing in the losses incurred by insurers by paying 95% of such insured losses.  In addition to quota share reinsurance, the federal government would also provide stop-loss protection.

Rep. Maloney first introduced PRIA legislation in May 2020 in response to the COVID-19 pandemic.  PRIA has been referred to the House Committee on Financial Services.

The text of the law can be found here.