2021 -- H 5052

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LC000183

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2021

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A N   A C T

RELATING TO INSURANCE -- COVID-19 INSURANCE RELIEF ACT

     Introduced By: Representative Joseph M. McNamara

     Date Introduced: January 22, 2021

     Referred To: House Corporations

     It is enacted by the General Assembly as follows:

     SECTION 1. Title 27 of the General Laws entitled "INSURANCE" is hereby amended by

adding thereto the following chapter:

CHAPTER 82

COVID-19 INSURANCE RELIEF ACT

     27-82-1. Definitions.

     (a) "Employee" means a full-time employee who works a normal work week of twenty-

five (25) or more hours.

     (b) "Net premiums written" means gross direct premiums written, less return premiums

thereon and dividends credited or paid to policyholders, as reported on the company's annual

financial statement.

     (c) "State of emergency" means the state of emergency declared under executive order 20-

02, issued on March 9, 2020, to protect the well-being of Rhode Island citizens from the dangerous

effects of the COVID-19 pandemic.

     27-82-2. Coverage for business interruption.

     (a) Notwithstanding the provisions of any other law, rule, or regulation to the contrary,

every policy of insurance insuring against loss or damage to property, notwithstanding the terms of

such policy which includes, as of the effective date of this act, the loss and use and/or occupancy

and business interruption within the state shall include among the covered perils under such policy

coverage for business interruption directly or indirectly resulting from the global pandemic known

as COVID-19, including all mutated forms of the COVID-19 virus.

     (b) Any business lost due to the COVID-19 global pandemic, subsequent to the issuance

of executive order 20-02, shall be construed as a direct physical loss or damage to the insured.

     (c) No insurer in the state shall deny a claim for the loss of use and occupancy and/or

business interruption due to the COVID-19 pandemic, even if the policy omits language regarding

a pandemic or virus, or the policy excludes:

     (1) Losses resulting from a virus; or

     (2) Collection under the policy where there is no physical damage to the property of the

insured or to any other relevant property.

     (d) Subject to any monetary limits of the policy and any maximum length of time set forth

in the policy for such business interruption coverage, the coverage required by this section shall

cover the insured for any loss of business or business interruption until such time as the state of

emergency declaration issued by the governor pursuant to executive order 20-02 is rescinded by

the governor.

     (e) This act shall apply only to policies issued to insureds with one hundred fifty (150) or

fewer full-time equivalent employees in the state and policies which are in force on the effective

date of this act or which become effective prior to the date of which executive order 20-02 is

rescinded by the governor.

     27-82-3. Reimbursement for insurers.

     (a) Any insurer that is required to provide coverage to an insured that has filed a claim

pursuant to this chapter may apply to the department of business regulation for relief and

reimbursement from funds collected and made available for such purposes.

     (b) The department of business regulation shall promulgate rules and regulations for the

submission and qualification of reimbursement claims made by insurers which are eligible for

reimbursement pursuant to this chapter. The department of business regulation shall also

promulgate rules and regulations to protect against any fraudulent claims for reimbursement by

insurers and implement appropriate safeguards for insurers to employ in the review and payment

of such claims by their insureds.

     27-82-4. Assessments authorized.

     The department of business regulation is authorized to make one or more assessments in

each fiscal year against licensed insurers in the state that sell business interruption insurance as may

be necessary to recover the amounts paid, or estimate to be paid, to the insurers pursuant to § 27-

82-3. Any such assessment shall be made at a rate and shall be determined and certified by the

department of business regulation pursuant to § 27-82-3. The amount to be assessed shall be made

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against all licensed domestic companies and foreign companies in proportion to their net premiums

written and annuity considerations in the state as shown in their reports filed to the state. Said

assessment shall reimburse the state for funds appropriated for such reimbursement. Assessments

under this section shall be charged to the normal operating cost of each company.

     27-82-5. Severability.

     If any provision of this chapter, or the application of any provision to any person or

circumstance, is held invalid, the remainder of the chapter and the application of the provision to

other persons or circumstances are not affected by the invalidity.

     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO INSURANCE -- COVID-19 INSURANCE RELIEF ACT

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     This act would require an insurer to provide business interruption coverage due to the

COVID-19 global pandemic and all mutated forms of the COVID-19 virus. This act would also

mandate that any business interruption sustained due to the COVID-19 global pandemic constitutes

direct physical loss or damage to said business.

     This act would take effect upon passage.

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