“The restaurant industry is the largest private sector employer in America — it’s a chosen profession employing more than 15.6 million Americans and contributes $1 trillion to the economy. This entire sector is crippled by a nationwide public health shutdown impacting countless livelihoods. We need insurance companies to do the right thing and save millions of jobs.” - Thomas Keller
In New York, lawmakers have introduced legislation that would require insurers to cover the losses of businesses affected by the coronavirus outbreak, including restaurants.
Similar legislation has been introduced in Ohio, New Jersey, and Massachusetts, however, the insurance industry will clearly fight tooth and nail with legal challenges that could threaten the bill’s implementation should it become law.
Time is of the essence, with so many small businesses treading water at the moment. Any bill that would require insurance companies to reimburse them for their losses would be neutered if those businesses had already gone under.
In California, Phillip Frankland Lee, chef and owner of Scratch Bar, is also suing his insurer, Farmers Insurance Company for declaratory relief during the coronavirus crisis. The result of the litigation could have far reaching consequences in the for other operators in Los Angeles and Santa Barbara Counties (where Lee’s Scratch Restaurant Group businesses operate) during the Safer at Home state-wide mandate.
Many are calling on insurance companies to step up to save the industry. Many insurers inserted pandemic clauses in their policies after the outbreak of SARS and Ebola and therefore claim they are indemnified against any payout due to the current pandemic.
The effect of the coronavirus crisis on the economy is like nothing seen in generations and it will require radical solutions to recover, there is some political will to press insurance companies into footing the bill for the restaurant industry.
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