A bill lawmakers passed Friday could soon make it easier for lower Puna residents to obtain property insurance as the June 27 lava flow remains a more distant threat. ADVERTISING A bill lawmakers passed Friday could soon make it easier
A bill lawmakers passed Friday could soon make it easier for lower Puna residents to obtain property insurance as the June 27 lava flow remains a more distant threat.
The bill, which the state Senate passed on final reading, seeks the lifting of a moratorium the Hawaii Property Insurance Association put in place for much of the area last September.
The bill previously cleared the House and next will be sent to Gov. David Ige to sign.
Sen. Russell Ruderman, the bill’s main sponsor, said it’s one of the few things legislators can do to help residents affected by the lava flow.
“This bill is very important to return some sense of normalcy to Puna,” said Ruderman, D-Puna.
The lava flow has not been threatening Puna homes since its lower portion became inactive more than a month ago. The flow remains active within a few miles of the Pu‘u ‘O‘o vent.
The legislation says the moratorium shall be lifted if “residential property insurance is unavailable due to a moratorium.”
It also says insurance companies can choose to not renew no more than 5 percent of their policies in the area during the county’s state of emergency.
The bill provides exemptions for customers who don’t stay current on their premiums or if the state insurance commissioner determines the “financial soundness of the
insurer would be impaired.”
The county’s emergency declaration was extended for 60 days March 30.
The moratorium applies to properties south and east of Ainaloa and Hawaiian Paradise Park, HPIA said in September.
An HPIA spokesman said in an email in late March that the organization, which offers coverage in high-risk areas such as lava zones 1 and 2, would maintain the moratorium until the bill is signed into law.
“HPIA will be maintaining the moratorium at least until, and depending on, any chances which occur from the Legislature’s actions and enactment of that legislation by the governor’s signature,” he said.
Gordon Ito, state insurance commissioner, told the Tribune-Herald he has a commitment from HPIA that it will lift the moratorium when the bill is signed.
Bill Parecki, a Pahoa real estate agent, said in late March that the insurance issue has made it more difficult for residents to sell their homes without doing a cash sale.
Some areas have seen property values drop by as much as 30 percent as a result of the lava flow and insurance moratorium, he said.
“The terror is gone,” Parecki said, referring to the lava flow.
“It will probably be awhile before it (housing market) gets back to normal.”
Email Tom Callis at tcallis@hawaii
tribune-herald.com.
