Insurers object to order preventing lawsuits following Maui fires
Attorneys for more than 160 insurance companies claim that a
"I don't know of any state where we're dealing with an attack on an insurance industries' ability to seek recovery like we're seeing in the court in
The ability of property insurance companies to sue those found to be responsible for the
In more than 30 years of practice, Grotefeld said he has seen successful lawsuits that have led to criminal charges and changes designed to prevent future disasters.
Grotefeld was involved in litigation against
The
Last week on
The insurance companies do not want to go after their policy holders, according to Grotefeld.
"The property insurers are concerned they will not be able to pursue their independent rights of recovery against the parties responsible for causing the loss," Grotefeld and his colleague,
Pursuing recovery
In court documents filed in
Only
"
Grotefeld told the Star-Advertiser that, "The insurers want to pursue recovery against the parties that caused the fire. They don't want to seek recovery from their customers. We aren't suing the state of
The standoff threatens to unravel the proposed
The settlement would resolve more than 650 lawsuits filed in state and federal courts and would be funded by
Under the tentative settlement,
Unless there's a resolution, the terms of the tentative settlement would expire 90 days from
Asked what will happen if there's no agreement by the deadline, Grotefeld and Raboteau said in their follow-up email that, "We don't want to speculate. The property insurers will continue to participate fairly in the litigation focusing on what is in the best, long-term interest of our policyholders and the residents of
What lies ahead
Whatever happens next has broader implications for insurance customers on all islands, especially for dry leeward areas under growing threat of brushfires and drought.
Already it's hard for homeowners in
During the last legislative session, Ilagan introduced 10 bills in an attempt to help homeowners in need of insurance in Puna and across the state.
Most of Ilagan's bills were specific to Puna's Lava Zones 1 and 2, where lava from a Kilauea Volcano eruption inundated the
In between, 723 structures were wiped out, including an estimated 200 primary residences. Property owners filed 152 insurance claims from the
As a result, last year Universal Property & Casualty announced it was pulling out of the
So having insurance companies issuing policies on
"We definitely need to do something to stabilize the market," Ilagan said. "We have to find some solutions, but here we are now.
Discussions are under way ahead of the next legislative session to possibly draft bills to cap insurance premiums or otherwise help consumers buy affordable insurance policies.
But Ilagan has seen first hand what happened in Puna.
"Capping premiums is not something that private entities like insurance companies will welcome with big arms," he said. "They are going to feel that
Following the
Asked about the possibility that the
But future disasters in
Insurance companies typically buy insurance of their own on the global market to help cover payouts to policy holders in an industry practice known as "reinsurance."
But Ilagan said that companies that sell reinsurance are also growing skittish following billion-dollar payouts in the aftermath of disasters that are increasing in frequency and severity around the planet.
Ability to sue
Grotefeld said the ability to buy reinsurance also hinges on insurance companies' abilities to sue those responsible for damages in a practice known as "subrogation."
"It's a cornerstone of the insurance industry," he said.
Grotefeld stressed that the ability to sue has led to safety innovations.
Following his work in the
Cases he handled in
In
But even successfully suing those responsible for disasters does not prevent future ones.
A federal jury eventually convicted
But while still on probation for the
"Those that are attempting to demonize the insurance industry are doing no favor to the fire victims," Grotefeld said. "And trying to demonize the insurance industry does nothing to try to resolve this case."
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