White House, Congress Reach Deal
To replenish small business loan program. The White House and Congress have reached a deal on a new funding package that will replenish a lending program meant to aid small businesses impacted by the novel coronavirus outbreak, two administration sources confirmed on Tuesday. The details of the package are forthcoming but the deal is expected to include $310 billion for the paycheck protection program, including setting tens of billions aside for smaller lenders, $25 billion for testing and $75 billion for hospitals, according to lawmakers.
Six Insurers Face Federal Class Action Lawsuits
For denying business interruption claims. Federal class action lawsuits have been filed against several insurance companies for denying policy claims the plaintiffs had made to protect against business interruptions – specifically claims related to the business closures mandated in the wake of the COVID-19 pandemic. The six insurers are Aspen American Insurance, Auto-Owners Insurance, Lloyd’s of London, Society Insurance, Oregon Mutual Insurance, and Topa Insurance Company. The law firms involved said that the insurers “refused to uphold their contractual responsibilities for losses suffered due to COVID-19, as well as losses caused by executive orders by civil authorities and any efforts to prevent further property damage or to minimize the suspension of business and continue operations.”
Travelers Insurance Begins Filing Lawsuits
Against its own insured during pandemic. Travelers Insurance Company took the unprecedented step of filing federal lawsuits against its own insured, apparently to try and stop their insured from filing business disruption claims caused by the pandemic. As millions of small businesses have been forced to shut down based on civil stay-at-home orders by State and local officials, the small businesses which have been dutifully paying premiums for insurance have made claims under their policies for business disruption. The action taken by Travelers in suing its insured, however, represents an unprecedented escalation whereby the insurance companies have now begun suing their own insured to preempt the filing of claims and lawsuits.
Did You Know?
Restaurants’ bailout problem: Unemployment pays more. Restaurants represent less than 9 percent of Paycheck Protection loan recipients, but as of March end accounted for the majority of layoffs nationwide. Restaurants say their industry needs its own targeted recovery fund because the bailout package Congress passed last month is making it more attractive for their staff to draw unemployment benefits than to continue working. The new Paycheck Protection Program waives repayment of small business loans if the borrower uses 75 percent of the money to maintain payroll, a measure intended to reduce layoffs. But with the expanded unemployment benefits included in the stimulus bill, some workers can as much as double their weekly checks if they stay unemployed.
When your stimulus check isn’t what you expected. The U.S. government sent more than 80 million direct-deposited stimulus payments this week, and the amounts popping up in bank accounts are coming as a surprise to some Americans. Some are finding less than they expected. Others think they are getting too much. Some say money is going into bank accounts they don’t recognize. And still others are struggling to decipher error messages from an Internal Revenue Service website.
Restaurant Industry Daily Alerts
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