Rep. Pam Snyder

Rep. Pam Snyder

Despite having paid premiums that cover business interruptions, many bar and restaurant owners in Pennsylvania and around the country found that when their businesses were interrupted due to the coronavirus, insurance companies wouldn’t cover their losses.

In response, state Rep. Pam Snyder, D-Jefferson, is co-sponsoring a measure that would expand business interruption policies to include losses resulting over the last 14 months.

“I know what a tough business it is,” Snyder said at a Tuesday morning press conference in Harrisburg, noting that her parents operated a bar and restaurant for 30 years, and “I was literally raised in a bar and restaurant. These restaurants and bars should get what they pay for.”

Co-sponsored with state Rep. Malcolm Kenyatta, a Philadelphia Democrat, the bill would also allow insurers to receive reimbursement for business interruption claims that have to be paid because of COVID-19, and make those funds readily available.

“This bill is about fundamental fairness and ensuring that our bars and restaurants that have been so devastated by this pandemic, get the leg up they need to get back to normal and stay open,” Kenyatta explained. “Business interruption insurance is something almost all bar owners have. But now in the moment when those bar owners say they need it, insurance companies say they’re not going to cover it.”

Kenyatta continued, “Insurance companies need to keep up their end of the bargain.”

Restaurant and bar owners in Pennsylvania have plenty of company in having grievances with insurance companies over the last 14 months. Other businesses have filed suit against their insurance companies because their business-interruption claims have been denied. Insurance companies have countered that the businesses did not sustain physical damage as they would in a natural disaster like a tornado, flood or hurricane, and that if every claim were paid out, the insurance industry would be rendered insolvent.

Jack Prince, the owner of Bob and Barbara’s Lounge in Philadelphia, said his establishment was completely shuttered for four months, and then was allowed to reopen for outdoor dining only. More recently, it has been operating at 25% capacity with some outdoor dining, and that has been able to cover “half the rent and most of the bills.”

“We definitely pay a lot for our insurance,” Prince said. “We pay more than $1,400 a year.”

Starting Monday, restaurant and bar owners across the country began applying for relief money provided through the federal $1.9 trillion coronavirus recovery package approved in March. The $28 billion Restaurant Revitalization Fund would help proprietors cover payroll, mortgage and rent payments, utilities, the costs incurred by outdoor seating, and other expenses.

Kenyatta said, however, that the fund is “not nearly enough to meet the level of devastation we’re seeing throughout the hospitality industry.”

Staff Writer

Brad Hundt came to the Observer-Reporter in 1998 after stints at newspapers in Georgia and Michigan. He serves as editorial page editor, and has covered the arts and entertainment and worked as a municipal beat reporter.

See what people are talking about at The Community Table!

Thank you for reading!

Please purchase a subscription to continue reading. If you have a subscription, please Log In.