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2. N.Y. introduced bill on pandemic-related business interruption claims

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2. N.Y. introduced bill on pandemic-related business interruption claims

Early on in the COVID-19 pandemic thousands of businesses effectively had to close up shop as government-mandated shutdowns put most economic activity on hold in an attempt to contain the spread of the virus.

Many looked to their property insurance policies for business interruption coverage to recover lost income associated with the closures, but insurers often denied the claims saying direct physical damage was required to trigger coverage.

State legislatures sprang into action and began introducing bills, some of which would have forced insurers to retroactively cover business interruption claims due to COVID-19.

In March, New York lawmakers joined Ohio, Massachusetts and New Jersey in introducing such a bill.

The story, detailing the introduction of A. 10226 by New York Assembly members Robert Carroll and Patricia Fahy, was the second most read risk management-related story on Business Insurance’s website in 2020.

The New York bill would have required insurers providing business interruption and loss of use coverage to cover “business interruption during a period of a declared state emergency due to the coronavirus disease 2019 (COVID-19) pandemic.”

At the same time, some congressional lawmakers began to push legislation that would force insurers to cover virus losses.

Industry groups pushed back, arguing that the insurance industry would face bankruptcy if it was forced to retroactively pay out on risks for which insurers never collected premiums.

Several months later, various of the state legislative moves were quashed or scrapped, as the debate on how to fund for and mitigate against pandemic risks broadened on Capitol Hill.

No. 3 most read story.