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Stimulus Package? Where are you?

Aug 13, 2020

We were hoping to have some good news from Congress last week on the next COVID-19 stimulus package, but as of Friday, July 31, 2020, nada. This is disappointing for so many individuals and businesses, but is especially tough for the close to 30 million unemployed whose additional $600/week of federal unemployment aid expires tonight leaving them to rely, for the time being, solely on state unemployment benefits which many argue is paltry in comparison. According to reports, the Democrats had a proposal on the table for $3T in total aid while Republicans came in at $1T. The size of the divide between the two is easy to see. The parties also remain divided on the issue of limited immunity for employers, schools and hospitals from COVID-19-related litigation. Hopefully we will see some movement next week, and will share the same with you.

Evan Greenberg on Chubb, COVID-19 and Potential Solutions for Future Pandemics:

Chubb’s quarterly earnings were released this past week and, in addition to the quarterly call, Evan Greenberg, Chubb’s Chairman and CEO, appeared on CNBC’s Squawk Box to discuss Chubb’s financials and how COVID-19 losses are impacting Chubb and the insurance marketplace as a whole. Chubb’s numbers “exceeded Wall Street’s expectations with a loss of 56 cents per share, (and) the company noted that a significant amount of (that) loss came from coronavirus exposure, even before business interruptions (large property related claims in the pipeline) are taken into account. The losses were due to the expected decreases in payroll—the fewer employees a business keeps on payroll, the less exposure the company has to damages. That leads to less coverage being needed, leading to reduced premiums (taken in by Chubb).”

As for the industry as a whole, Greenberg told Squawk Box that this pandemic “’has no time limit, and it has no geographic bounds…For business interruption, the loss is essentially infinite, and the insurers have a finite balance sheet…So the insurance industry’s ability to take pandemic risk is very limited.’”

According to the American Property Casualty Insurance Association, “U.S. businesses are losing an estimated $1trillion a month as businesses are disrupted due to the coronavirus pandemic, (y)et insurers collect only $4.5 billion a month for all commercial property policies.” As a result, and as we have mentioned in previous posts, insurers and other industry experts are working with the federal government to come up with subsidized solutions for future pandemics that may arise.

Chubb has introduced a two pronged approach to the problem. The first is geared at small businesses which “would receive a predetermined payout based on payroll, if a pandemic lockdown were to be declared, while (the second is geared at) medium and large businesses (which) would receive an indemnity-based payout. In each case, Chubb would assume up to $15 billion, which grows over the next 20 years… (T)he government would assume the rest of the risk in Chubb’s proposal.”

As with the Terrorism Risk Insurance Act that came together post-9/11, any federal legislation creating a pandemic-related insurance backstop will take some time to establish.

Essential Workers and Presumption Triggering Workers Comp.

State legislatures continue to pass legislation which can help certain employees who contract COVID-19 to recover workers’ compensation benefits. On July 30, New Jersey passed legislation that “would create a rebuttable presumption for essential workers seeking workers compensation for acquiring COVID-19 on the job during a declared state of emergency.” If signed by the governor, the NJ legislation will be retroactive to March 9th. Other states, including California, Kentucky, Florida, Michigan and Wisconsin have passed similar legislation geared, in some cases, at a more limited group of individuals (e.g. first responders only, etc.). The idea behind the legislation is to ease the burden of proving causation in a workers’ compensation case. Because COVID-19 can be transmitted virtually anywhere, this presumption helps to provide some level of comfort to those individuals working on the frontline of the pandemic that they will have an easier opportunity to recover workers compensation benefits should they contract the virus.


Jeff Stein, Erica Werner and Eli Rosenberg, 30 million unemployed to lose extra jobless benefits, as talks between Congress and the White House collapse, The Washington Post, July 31, 2020.

Jeff Stein and Erica Werner, White House willing to cut a stimulus deal without ‘liability shield,’ breaking with McConnell, The Washington Post, July 31, 2020.

Anjali Sundaram, Chubb CEO on insuring in a pandemic: ‘It’s unlike any other catastrophe’,, July 30, 2020.

Contessa Brewer, Insurers lobby for federal pandemic insurance program,, July 21, 2020.

Angela Childers, New Jersey legislature passes COVID presumption bill, Business Insurance, July 31, 2020.

Chartwell Law, Covid-19 Workers’ Compensation Presumptions,, May 18, 2020.


Carrie O’Neil
Senior Vice President, Legal & Claims

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