A bill that would retroactively rewrite insurance contracts to cover business losses from the coronavirus outbreak is pending on Beacon Hill, but critics argue it could collapse the industry and questioned its constitutional muster.

“This COVID-19 situation is a risk that I don’t think anyone could have possibly foreseen,” Kristen Whittle, partner at Barton Gillman, told the Herald. “I’m not insensitive to the plight of businesses. Everybody is struggling with this, but to target the insurance industry to absorb the loss, I think, is the wrong approach here.”

Sen. James Eldridge, D-Acton, filed a bill mandating that insurance companies cover business interruption of COVID-19 after seeing the threat to survival of small business posed by Gov. Charlie Baker’s near statewide shutdown, an effort he emphasized he supports to slow the spread. Insurance companies would have to cover costs for companies with 150 employees or fewer, even if a contract specifically excludes losses caused by a virus.

“I’m not looking to attack the insurance industry,” Eldridge said. “I’d like to see us come together and agree on the details in the bill, but my focus right now is on how to support restaurants, their workers and other small business.”

Insurance companies could apply for reimbursement from the Commissioner of Insurance, Eldridge noted, but would later be required to pay the state back based on an assessment of the industry.

Steve Clark, vice president of government affairs at the Massachusetts Restaurant Association, said the bill is “an important first step,” but added that a federal re-insurance bill may be necessary because, “we know that insurance companies have money, but they don’t have unlimited funds.”

David Sampson, president and CEO of the American Property Casualty Insurance Association, raised “serious concerns,” that the “constitutionally-flawed legislation” will compromise the financial ability of insurers to meet their existing promises and “threatens the stability of the sector, to the detriment of all policyholders.”

“It is questionable whether the law would be constitutional,” said Laura Meyer Gregory, partner at Sloane and Walsh LLP. “The bill, if passed with the current terms, would likely bankrupt some insurers and cause others to discontinue writing insurance policies.”