Why marketability of title insurance is forward

[pbmaise]

Okay, time to read the laws of Hawaii.

§431:1-206 Property insurance defined. Property
insurance is insurance against loss of or damage to
real or personal property of every kind and any
interest therein, from any or all hazard or cause and
against loss consequential upon such loss of or
damage. An inclusion within other defined classes of
insurance of the right to insure against certain
designated perils to real or personal property shall not
be deemed a diminution of the definition of property
insurance.

Notice: By the law your insurance policy includes all hazard or cause.

Question:

Is the lava flow a hazard?

Did it cause insurance companies to issue moratoriums?

Did this as a consequence hurt your property value because buyers want new insurance?

By legal definition of what property insurance is in Hawaii, do you not have a right to file a claim?

[pbmaise]

I bring up law in Hawaii specifically because laws govern whether or not insurance companies are liable and must make payouts DESPITE what they claim or is written in their policy.

I have covered this issue in depth in the Lava Insurance thread.

Laws in Hawaii still govern insurance companies after you purchased your home.

[pbmaise]

TomK,
Forward means into the future. The debate I am trying to win is whether title insurance ends upon the date of purchase.

Or, if it carries into the future providing continuing insurance.

99.9999% believe the document is dead and only protects for a past harm to Title.

I acknowledge that is how policies used to work, however, contend it changed and continuing insurance protects many home owners.

This community did a great job understanding the theft of a $200 donation jar caught on video tape.

Understanding millions of dollars in insurance claims, when nothing outwardly happened to homes, takes slightly more thought. I apologize I don't have a video.

[pbmaise]

Insurance pays out only if there is a loss.

Perhaps I should backtrack and establish that this hypothetical situation is a loss:

1. Jane buys a home in LZ 2 and obtains a conventional conforming loan from Wells Fargo Home Mortgage and a line of credit from Wells Fargo Equity direct. Her downpayment was 10%. Her insurance HPIA.

2. Lava flow approaches and consequential actions by lenders and insurers. She attempts to sell to Dick. The potential buyer learns Wells Fargo will not offer the same loan products and the only insurance available is from Llyods.

3. The buyer pulls out of deal unless Jane cuts price deeply. He shows homes one neighborhood up the coast have better financing and insurance.

Has Jane suffered a loss?

[Guest]

I have to bite, no she still owns the home so no loss. Maybe the next potential buyer just pays cash. My situation is a bit different for I paid my mortgage off and no longer owe, yet I cancelled insurance around the same time I paid off the house. After reading our old insurance policy, I could not see why we were paying so much for the possibility of so little in return. Of course insurance is one of those important things that's better to have and never need, than to need it and not have. Now I am not sure we can get descent insurance in lava zone one, at least some we can afford.
Thankfully we own a small lot with a simple house so selling cash only wouldn't be all that hard. Someone like yourself P.Maise I can see why you would have your concerns, yet majority may not even own their homes, maybe they rent or get that super 8 program.

[kalakoa]

Did Jane purchase the house as an "investment" (in which case the concept of "loss" is relevant) or as a "home" (in which case the "value" is not measured in dollars)?

If the house was intended as an "investment", then Jane failed to perform due diligence which might have exposed the excessive risk.

[Kapohocat]

quote:

---

Originally posted by pbmaise...
What I suspect is someone filed a claim in the name of the RLT before revocation. The title company then said hang on a tick, who are you? Claim denied. Then I bet they revoked the trust, and the Title company said claim was filed too late. Claim denied.

In this thread I am not trying to prove RLT conversions do not kill the Homeowner's policy. However, you help to prove the point that the document is alive after closing.,,

---

The RLT was still in effect after the death of MES and AJS, as my brother was appointed the trustee. it is still in effect today as we take care of the last of the items.

DCCA is looking at this for us - we filed a complaint just in November. We also retained our rights by filing a claim prior to the sale of the property.

There is an additional policy that is now sold that is called the "Eagle Policy" by FATIC that covers this situation.

They began selling it in late 1999 or early 2000 after being sued a few times and sometimes winning and sometimes not. Since this transfer happened in 1998 (to the RLT), FATIC says it is not covered.

Our choices are:

1) Do nothing. Write off the $2000 as expense.

2) File with DCCA and let them sort it out, and settle for their answer. <<<< What we chose. If DCCA agrees with our complaint they will contact FATIC about payment.

3) Hire a lawyer who will cost is more than the original amt and fight it out.

Since RLT's started to become popular in the 80's, and now those people are typically in their 70's and 80's, it is coming to light more often for those who created their RLT in the 1980's and 90's.

As for the banks, seriously, the right hand doesnt know what the left hand is doing. The bank told us at one point that if a child inherits the property as we did on the other house, the bank has no idea of the transfer until they receive the property insurance policy with a different name.

Therefore since no one sends anything to the bank when the title policy is voided, the bank has no idea.

And if you would like the documentation, I got a drawer full.

[pbmaise]

Kalakoa,
A buyer can not do all investigation which is why Title Insurance exists. If a problem arises after closing they are covered unless the policy and laws in Hawaii say otherwise. The latter taking precedence.

Now recall who I was. I was a direct employee and representative of the largest lender for homes in Hawaii and drove from Kalapana each working day.

Twice a day I would look out towards Pu'u O'o. Frequently I stopped to observe from the highway. I looked out upon areas I was told not to accept applications since lava flow was forseeable in that area.

Not once did I think or consider that lava from Pu'u O'o could flow down the North flank into areas I was accepting loan applications up near Pahoa town.


If I did not forsee the June 27 flow, how can we blame someone who didn't either.

My testimony like mine could be vital in any trial since the Title firm will claim just as you have that the June 27 flow was forseeable.

20/20 is very forseeable.

No direct loss is necessary to file a claim. It is only necessary for a cloud upon title to exist.

Cash buyers are typically looking for deals at bedrock prices. That is why the measure is against a typical buyer for the property that needs financing and insurance.

[Obie]

Hey Phil

I hate to bring this up but your Topic is :

"Why marketability of title insurance is forward"

Could you as the OP stay on topic ??

If you can find insurance that will reimburse for my bad decisions,I want to know about it !!

[TomK]

"The debate I am trying to win is whether title insurance ends upon the date of purchase."

Thanks. Why not just say in the subject field "Does title insurance end upon the date of purchase?". It would be much less confusing.