Senator Vincent Hughes and Senator Anthony H. Williams

HARRISBURG – April 20, 2020 – Several small business owners and the Pennsylvania Restaurant and Lodging Association (PRLA) joined state Sens. Vincent Hughes (D-Philadelphia/Montgomery) and Anthony Williams (D-Delaware/Philadelphia) in the call for temporary changes to business interruption insurance during the COVID-19 emergency.

Small businesses in the commonwealth have been forced to close indefinitely because of the pandemic and many business owners have learned that their insurance policies do not cover damage or property loss caused by a virus. Senate Bill 1114 would allow for temporary changes to business interruption insurance, which would allow Pennsylvania’s small businesses the ability to make claims for losses and damage related to the COVID-19 pandemic. SB 1114 has received bipartisan support in the state Senate.

“We need to aggressively move this issue forward to help protect our small business owners all across Pennsylvania,” Sen. Hughes said of SB 1114. “This is a critical juncture for many of our small businesses that may be forced permanently close their doors if they don’t get some kind of relief during this crisis. This should be of our utmost concern as we move to restart our economy.”

“We’re asking all of the parties to come to the table with the legislature and work out a solution that is fair to business owners who purchased interruption insurance and keeps the insurance industry solvent,” said Sen. Williams. “It’s important that businesses have the ability to make payroll and meet other financial commitments so insurers have customers in the future, and the government, at all levels, needs to facilitate that.”

Sens. Jay Costa, Lisa Boscola, Maria Collett, Tim Kearney, Katie Muth, John Sabatina, Steve Santarsiero, Judy Schwank, and Sharif Street also joined Monday’s call in support of the business interruption insurance proposal. You can watch the full press event by following the link.

“When some many other industries are stepping in and stepping up to help small businesses and communities, it’s disappointing to see the insurance industry not engage on the issue of business interruption insurance,” said John Longstreet, PRLA president and CEO. “Our restaurant operators paid for business interruption policies in the event of the unimaginable and, now that the unimaginable has happened, they are left empty-handed.” 

Pennsylvania is home to 1.1 million small businesses that employ more than 2.5 million people. The pandemic and subsequent closings of non-life-sustaining businesses has left many of these businesses without any additional financial resources because of high demand. As of today, funding for local, state and federal loans have been tapped.

“As someone who previously suffered a terrible loss in our shop due to arson & water damage, I have been fully aware of the importance of insurance and what it can do to help a business lift itself out of difficult situation,” said Judy Ni, owner of Baology in Philadelphia. “This is exactly why we continue to maintain it – to protect our team and their livelihoods, our guests, as well as our business. The protection is for us and the community we serve.”

As of April 20, there have been 33,323 confirmed COVID-19 cases and 1,204 deaths during the pandemic. In the interest of public health, Gov. Tom Wolf ordered all non-life-sustaining businesses close March 19 and issued a statewide stay-at-home order April 1, which is expected to extend through at least May 8.

“There is no difference in the damage suffered from the closing of a restaurant due to either a structure fire or by government mandate,” said Duke Gastiger, owner of RE Farm Café in State College. “Both are unforeseen calamities.  Although most policies have an exclusion for terrorism I have never seen one for forced closing by the state for pandemic mitigation.  As an operator we pay the premiums for blanket coverage which likely includes reimbursement for loss of business for every instance other than the listed exclusions.”