04-16-2010, 04:34 PM
quote:You can start with Hawaii Revised Statutes §431:21-101 through §431:21-118.
Originally posted by StillHope
I don't know what to think -can not find HPIA website.
Is it available only through an agent?
HPIA is a funny beast.
It's similar to the standard P&C/Auto risk pools you see in some states. Basically all insurers are required to be in the pool and are assigned cases when people can't get insurance on their own. So lets say your young, buy a used car, live in NY but no insurance company will insure you. You get the insurance from a company the state assigns from the pool.
But unlike those normal risk pools which can comprises hundreds of thousands, HPIA is about 3,000. Since all cost of the program must be paid by the policyholders, the risk and cost are shouldered by few, compared to any other type of risk pool.
What makes this hard on property owners is because the pool is so small, insurers are few and the cost they want is high. You also have an awful lot of people on Hawaii who believes this is government socializing lava insurance. They believe it should be a free market and businesses should set market prices. But as we all know, when it was up to insurance companies alone, they said no way to Lava Zone 1 and nobody could get insurance. So government was forced to step in.
Of concern is what happened in Florida (with hurricane insurance) where the insurance companies lost millions, raised rates, people complain, state said no to the rate increases and some companies said screw you and pulled out of the state. That reduced completion, placed more risk on those still operating and rates went up anyway. What would happen if all the high risk carriers said No, we’ll stop selling insurance in Hawaii and concentrate on the mainland? Because Hawaii is so small, it’s not a major thing for them to pull up stakes and leave policy holders high and dry.
So Hawaii may know the rates are too high, but how do you balance the small risk pool premiums against loosing a major carrier? I’m sure the people on Kauai, Maui and Oahu won’t be too happy if their carriers says good-bye because they are being forced to cover a few on Hawaii who freely made the decision to live in Lava Zone 1.