Pandemic Risk Insurance Bill Sponsor Sends Message to Hollywood: "I Need Your Help"

Carolyn Maloney
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With many productions at a standstill due to the lack of pandemic insurance, Rep. Carolyn Maloney says of her bill to help foster that insurance, "My goal is to pass this bill in the first 100 days of the Biden administration and I think we can do that if we get those in the industry to put some skin in the game and go after getting co-sponsors on."

Rep. Carolyn Maloney wants Hollywood to "get some skin in the game" when it comes to helping create pandemic risk insurance that will restimulate film and television production.

The New York Democrat and sponsor of the Pandemic Risk Insurance Act of 2020, which was debated on Thursday in a U.S. House Committee on Financial Services hearing where some members of Congress expressed skepticism with the plan, says that her goal is to pass the bill within the first 100 days of president-elect Joe Biden's administration — which she thinks will be feasible, with help from the entertainment industry. Despite concerns from some insurance industry representatives and fellow Congress members expressed on Thursday's hearing, Maloney maintains that her bill is just a rubric to get the conversation started and she is "open to collaborating with everyone."

She certainly has been collaborating so far with Hollywood companies, and on Wednesday, a list including the Motion Picture Association, the Independent Film & Television Alliance, The Internet & Television Association, IATSE, Directors Guild of America, NAB, Producers Guild of America, NPACT and SAG-AFTRA expressed their support for Maloney's bill, which they called "a positive step and we support this hearing as an essential next step to addressing this issue." Maloney says she is also in conversation with studios, unions and film and television productions companies, not all of whom are ready yet to go public with their support.

Lori McCreary, CEO of Revelations Entertainment, chair of the PGA Production Safety Task Force and former PGA President, whose Guild supports Maloney's bill, explains that "the biggest issue for producers is that right now insurance excludes any COVID-related claims. This is a problem especially in the independent world. As independent producers, we rely on what's called a completion bond and insurance in order to get our bank loans and our financing. Without COVID coverage, most of those productions are not happening right now" because projects cannot procure or lost their financing. "I think that it's a shame because that's where a lot of our new, important and authentic voices come from — the independent world."

In an interview with The Hollywood Reporter hours after the U.S. House Committee on Financial Services hearing, Maloney discussed her next steps with the bill, why "we can't afford to wait any longer" on a pandemic insurance solution and why she needs public Hollywood support to get her bill passed.

Based off of how that hearing went, how are you feeling about the future of your Pandemic Risk Insurance Act bill and what are your next steps?

Well, I am very enthusiastic and very optimistic. I'm going to be working hard to get a consensus to introduce a bill in the new Congress and try to move it in the first 100 days of a Biden administration. I believe I heard a consensus that's been formed so that we're just debating the best way to structure the program, and I'm open to collaborating with everyone. [Opponents] kept saying "this is it," and I said over and over again, "This is just the beginning, it's easier to have a draft to comment on then to just have an open slate that really doesn't go anywhere." The three points that everyone seemed to agree on is that they agree that there is a problem that requires a solution at the federal level; they secondly agreed that any federal program must be supported by a federal backstop; and thirdly that any federal program must include risk-sharing between the federal government and the private sector, in other words a public-private partnership to address the program.

But I was very much encouraged by the testimony of two representatives, key leaders in the insurance industry: John Doyle, the president and CEO of Marsh and also Michelle [Melendez] McLaughlin, the chief underwriting officer for Chubb. They both testified in support of some form of a pandemic risk insurance program that had a federal backstop, unlike some of the panelists who said they didn't think it was insurable. They felt like they had the data and believed it was insurable and that a public-private partnership was part of risk sharing and a federal backstop, so I thought those were very positive elements going forward. I was encouraged by the opening statements of Congressman Stiver, that he wanted to work together on a bipartisan bill — I do too. Regrettably the election slowed things down, everybody got involved in their own elections and I was told they didn't want to work on it until after the election, which is now. That's why I held the hearing that we held today.

Several Congress members in the hearing expressed a view that Congress shouldn't pass legislation regarding pandemic insurance until after the pandemic is over to know what works best. Do you realistically think there is enough support in Congress to pass legislation during the pandemic for the next pandemic on insurance?

Well I don't want to comment on a hypothetical because they're saying that the vaccine's going to be out in mid-December, and the military's going to be distributing it and they know to get things done, so let's look and see. I think it's really disturbing that there's so many people ill now, and that the number of infections have gone up, not down, and that the number of people in hospitals has gone up. We're in a crisis situation. But we also have a lot to look forward: At the very least I believe we can't afford to wait any longer. We need to start developing a plan now so we aren't having the same conversation again about a lack of coverage. And we can't continue to expose our overall economy and small businesses to this level of risk and ever expect them to recover. And I would say that we know, should you have another pandemic or another crisis, the federal government is going to step in. Why not be proactive and try to develop an efficient, effective, long-term solution, working with the private sector in a productive way for the economy, for people and for small businesses?

And I want to say, on the need to act, literally tens of thousands of small businesses have closed their doors permanently. We have to come forward with something that can make it happen and I want to really stress that it's all voluntary. We're not forcing anyone into anything — it's all voluntary. Insurers could provide policies if they wanted to and policy holders could [buy] policies if they wanted to. It's totally, totally voluntary and a broad consensus has emerged that the pandemic risk is insurable with an appropriate federal backstop: We have over 50 organizations that have endorsed it.

We're hearing particularly that it's very harmful to Hollywood and to getting starting, moving forward with [production] plans. I've been working forward with the Independent Film & Television Alliance, labor unions and other film/TV production companies. So I'm aware of their concerns and we'll continue to work with them to incorporate their issues to make sure that they can get up and start running again. And a large coalition of media companies, like the NFL and the Motion Picture Association, wrote a letter to the Committee expressing their need and their support for a pandemic risk insurance program.

As you said, a number of entertainment and sports companies sent a letter to ranking members and chairs of the House Financial Committee yesterday in support of action on the insurance issue. I know that the Independent Film & Television Alliance is on the list of endorsing organizations in favor of your bill. Are there other entertainment organizations that have expressed their support and/or who you are speaking with in order to get their perspective in the bill?

We have tons of them coming in. I would say that the entertainment industry has been very, very hard-hit. I've been working with some that I can't share publicly but they're not publicly supporting the bill now. But they've made clear that they've lost a lot of jobs associated with film and TV production and more are at risk. I've been told film and TV production declined almost 98 percent in the last quarter compared to 2019 and that many films have been cancelled, up to 400, due to the lack of pandemic insurance costing tens of thousands of jobs and a significant loss in tax revenue. It has a big impact on the economy. And they are telling me that without pandemic risk insurance, film and TV producers will be unable to restart production since their lenders typically require insurance policies that will cover the risk that a film will not be finished or delivered for distribution, so that's a big problem. I'd say that film and TV production companies need a federal program like PRIA that would create a marketplace for pandemic risk insurance policies, that they could purchase to protect themselves from COVID or other pandemics or other diseases that have forced them to shut down.

One highly publicized event was we saw with the recent Batman film, we saw with that film that it only takes one member of a production crew to test positive for COVID-19 to shut the entire project down and that's devastating for the industry.

To make matters worse, other countries like Canada, right next to New York, France, Germany and the U.K., have quickly passed programs to cover these risks, so I am concerned. The film industry's a big industry in New York state and New York City and if we aren't equally proactive as Canada in providing the same relief, that film and TV producers will be forced to take projects to other countries, robbing our country, our states and our cities and communities of tens of thousands of jobs. And I would say a significant tax return. And that's going to impact the overall economy of our country.

Hollywood has clearly signaled its support for some kind of policy on pandemic insurance, and are urging swift action. What are your suggestions for what industry organizations can do in order to make that happen in a timely manner, or convince skeptical Congress members that such a measure is needed?

Well I would say that Hollywood has a lot of power. Because it the public loves Hollywood, they love actors and actresses, they love the stars, they love the gossip, they love everything about it. They don't want to hear boring politicians like myself talk, which [one way] how you get the bill through Congress. But a very, very important part — and I've passed a ton of bills — of mobilizing public support is getting TV stars behind it. I passed a very important bill, $85 million for giving healthcare compensation for our 9/11 workers, who risked their lives to save the lives of others, they were sick and dying, there was no healthcare for them. The person that helped me pass it the most was not the Speaker or anyone, it was Jon Stewart. Jon Stewart took an interest and he would speak out. He would come to these hearings. My role is to get every member of Congress on it, which I got, I got 400 members on it. I played the nice guy and he went into "All of you have got to go to hell! How can you sleep at night knowing that these people are dying because you won't give them healthcare?" He would just beat up on them.

We need spokespeople from Hollywood to speak out on it. For example, when I passed that bill, I would have a press conference every two weeks, practically, bringing out people to be part of the press conference, to speak out on it and to talk about the need. It's one thing to talk about statistics that move people — like I have one now that film and TV production declined 98 percent last quarter. That's horrible. But what would be more impressive to the public is someone from the Batman movie to say, "Hey, I'm out of work now because we couldn't get insurance to get our movie going." You put a human face on it, that we're all out of work and on unemployment because we can't get insurance to get the movie industry moving. I'd suggest that companies reach out to members of Congress. A lot of times you've got a movie industry on New York, I'd suggest to them to reach out to the New York delegation and say, "Hey, I can't produce a film until this happens, go on the Maloney bill, work it out with her so we can pass it." Getting members of Congress on the bill is important. For example, the bill that I gave you that Jon Stewart did, we got 400 members of Congress to go on a damn bill. How could they say no? We got everybody for it. You needed to be creative with a message to get it out that it's needed.

Some of the popular shows that have had to stop, have them come out and speak to the public in press conferences about the need for the bill. The entertainment industry's been calling us on "What are you doing, how are you passing it?" Well, I'd like to call them and say, "What are you doing to help us pass it? Get some skin in the game." My goal is to pass this bill in the first 100 days of the Biden administration and I think we can do that if we get those in the industry to put some skin in the game and go after getting co-sponsors on. I need your help, that's basically what I'm saying.

It's work. It doesn't fall easily from heaven. I have great respect for any bill that can get that fragile flower of consensus, the majority of votes in the United State House and Senate, and to get that, you need a strong majority of I'd say at least 250-300 cosponsors, which means going in and asking them to do it. And then also getting the public to demand it, which is getting your Batman to say "hey, I'd love to be starring in this movie."

This interview has been edited for length and clarity.