Who likes to live dangerously?
Everyone who lives here in Hawaii, obviously :)
Going to quote this article extensively as it's informative and important to the future of insurance in Hawaii. I beg the indulgence of the overseers of moderation.
Green blasts State Farm for refusing to settle Maui claims
https://www.staradvertiser.com/2024/08/2...ui-claims/
Instead of addressing sea-level rise and climate change, Gov. Josh Green now wants income from a proposed visitor impact fee to help the state provide its own insurance to victims of future disasters following the Aug. 8, 2023, Maui wildfires.
Green called out the insurance industry’s “terrible, terrible greed” for holding up a proposed $4.037 billion “global settlement” that would resolve over 650 claims and lawsuits in the aftermath of the wildfire that killed 102 people and destroyed nearly 4,000 structures, most of them homes.
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He praised local attorneys for being willing to give up the right of their insurance company clients to sue those ultimately responsible — including the state — in order to reach a settlement because “it was for the good of the community” by getting settlement money into the hands of Maui victims over three years, beginning in 2025.
But Green repeatedly told the Honolulu Star-Advertiser editorial board on Wednesday that he blames mainland lawyers representing State Farm Insurance for demanding to be able to sue to recoup their insurance payouts.
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Among several names, he called State Farm “greedy” and “ruthless” and more interested in profits than helping Maui victims become “whole.”
He accused the company of wanting to pursue lawsuits to maintain “massive profits” and “giant profits.”
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“Holding up recovery is a very large deal for me as governor and I’m going to push hard,” Green said. “They have an opportunity to do right by us.”
State Farm representatives did not immediately respond to a request for comment Wednesday.
As Hawaii tourism numbers continue to climb following the COVID-19 pandemic, state legislators are expected to again consider the possibility of charging tourists a special fee that was originally intended to offset their impacts on the environment and help the state respond to climate change.
The idea remains popular in a state of 1.4 million people who pushed back against the record-setting 10 million tourists who visited just before the pandemic hit in 2020.
Last session, legislators liked the idea of a new tourism fee in concept but could not agree on how much to charge — or how — and pledged to revisit the idea when the next session begins in January.
Now Green wants to use the potential income to help the state borrow money to provide its own disaster insurance for local residents and businesses through a “captive insurance” program he wants to develop on a large scale.
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So far, over 160 insurance companies have paid out $2.3 billion in claims to Maui victims, with expectations of another $1 billion in payments.
State Farm has been involved in each step of mediation that led to the tentative “global settlement” on Aug. 2, Green said.
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The insurance industry initially wanted $65 billion, then $30 billion, $12 billion and then $7 billion in the settlement, Green said.
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Under the proposed settlement, Hawaiian Electric would pay $1.99 billion, Kamehameha Schools would pay $872.5 million and the state would pay around $750 million. Amounts by Maui County and three other defendants — West Maui Land Co., Spectrum Oceanic LLC and Hawaiian Telcom — have not been disclosed, but add up to about $400 million.
“Mainland attorneys (representing the insurance industry) want to claw back 40% of the total settlement,” Green said.
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The state has joined plaintiffs’ attorneys in asking Maui’s 2nd Circuit Chief Judge Peter Cahill to ask the state Supreme Court to enforce Cahill’s ruling preventing insurance companies from pursuing damages directly from Hawaiian Electric, the state, Kamehameha Schools and Maui County.
Cahill is scheduled to consider the request Friday.
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Not reaching a settlement would lead to protracted court battles of five to seven years, Green said, and likely would bankrupt Maui County and Hawaiian Electric.
“The state would have to bail out the county and come up with a new energy model,” he said.
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Asked if he’s worried that insurance companies will leave Hawaii if the Supreme Court rules against them, Green said “we know they’re going to do it anyway because they’re already doing it.”
In Hawaii island’s Puna District, the last insurance company writing homeowner policies in Puna’s Lava Zones 1 and 2 announced it was pulling out of the market because of the ongoing threats of hurricanes, tsunamis and volcanic eruptions.
So Green wants a new way for the state to provide insurance for future disaster victims because, he said, “it’s already a broken system.”
