24th May 2020

US insurance trade associations unveil Business Continuity Protection Program(BCPP)-a new customer-focused proposal for a federal program tailored specifically to help businesses meet the financial challenges from future pandemics

The National Association of Mutual Insurance Companies (NAMIC), the American Property Casualty Insurance Association(APCIA), and the Independent Insurance Agents & Brokers of America(Big “I") have unveiled a new customer-focused proposal for a federal program tailored specifically to help businesses meet the financial challenges from future pandemics. The industry-backed Business Continuity Protection Program(BCPP) would provide revenue replacement assistance for payroll, employee benefits, and operating expenses following a presidential viral emergency declaration.
“Pandemics simply are not insurable risks; they are too widespread, too severe, and too unpredictable for the insurance industry to underwrite,” said Charles Chamness, NAMIC’s president and ceo. “As we’ve seen in the past few months, pandemics are a national problem, and we need a national solution. NAMIC, APCIA, and the Big ‘I’ had one goal in mind in developing the BCPP-crafting a solution that would provide meaningful support for employees, businesses, and the economy as a whole.”
The BCPP is a solution that can work for everyone—customers of all sizes and structures—to provide protection against widespread economic shutdowns due to a future viral outbreak. Much of the dialogue to date has involved a program modelled after the Terrorism Risk Insurance Program, created after the 9/11 terrorist attacks under the Terrorism Risk Insurance Act (TRIA). However, a TRIA-like program, with an industry financial role, does not square with the fundamental notion that pandemics are not insurable risks. The risks are too fundamentally different in nature and scope.
"We need a sustainable solution that provides simplicity, certainty, and immediate relief to impacted businesses,” said David Sampson, APCIA’s president and ceo. “The BCPP is designed to bolster the country’s economic resilience through timely and efficient financial protection and payroll support in the event of a future public health emergency. We look forward to continued dialogue with the business community to meet their needs in this vitally important public policy discussion.”
The BCPP would provide business revenue replacement assistance that would reimburse up to 80% of payroll, benefits, and expenses for three months. The association leaders believe the advantages of the BCPP approach are significant, providing simple, immediate relief for employers that are directed to close.
“The small business community is looking to our industry to provide leadership to ensure there is immediate assistance available during future pandemics,” said Bob Rusbuldt, Big “I” president & ceo. “The BCPP is a simple, efficient, and effective plan to provide the needed financial security for American businesses. This program gets immediate funding to businesses when they need it most.”
Businesses would purchase their desired level of revenue replacement assistance through state-regulated insurance entities that voluntarily participate with the BCPP. Under the BCPP, the Federal Emergency Management Agency, with limited administrative assistance from private contractors, would provide the critical mechanism of administering relief to businesses. And the BCPP would be able to purchase private reinsurance to protect federal taxpayers.
NAMIC and APCIA represent approximately 90% of the home, auto, and business property/casualty insurance underwriters in the US. The Big “I” is the nation’s oldest and largest national association of independent insurance agents and brokers, representing more than 25,000 agency locations united under the Trusted Choice brand. The three trade associations look forward to working with members of Congress and the Trump administration to enact the BCPP to protect America’s businesses.