(Editor’s note: Following is the correct version of Jill Raznov Wedgwood’s article entitled, “Disaster Recovery — Tropical Storm Iselle and Pu’u O’o Lava Flow.” Big Island Chronicle inadvertently published an earlier flawed version in the latest print edition. BIC regrets the error and will republish the following article at our earliest convenience.)
By Jill Raznov-Wedgwood
About a week after my return from a mainland trip, as I was settling back in to my routine, I learned that hurricane Iselle was headed straight for Hawaii Island’s East Side. Downgraded to a tropical storm by the Central Pacific Hurricane Center just before making landfall on August 8th, Iselle’s impact was, nevertheless, felt sharply by residents, farms and businesses from storm surges, downed trees, heavy rain and winds, and power outages.
Earlier this past summer, new vents opened on the northeast flank of Pu’u O’o crater on Kilauea leading to a continuously advancing and retreating lava flow which has caused many serious disruptions and changes to the lives of the people and businesses of Puna Makai and the vicinity. As people continue to confront their changed and changing lives after Iselle and from the continued lava inundation, many legal questions have arisen, several of which are further discussed here.
1) What types of damages does my homeowner’s insurance cover? An insurance policy is a binding contract, however, there is no one size fits all approach. Each policy is different in terms of amounts and types of coverage and may extend beyond just the residential dwelling and its contents to other appurtenant structures, personal property, loss of use or any other coverage, which you have chosen and for which you pay monthly premiums. It is important for you to know and understand what property and types of damages are covered under you policy, as well as the amounts of such, and your deductible, so as to better negotiate with the company in case of a claim and also so you are not taken by surprise if something you thought was covered turns out not to be. If you cannot locate your policy, make a written request to your insurance company for delivery of a copy of your policy (declarations page, which includes the above personalized information, as well as the entire policy explaining coverage types, exclusions, how to make a claim, etc.), within a reasonable time period (usually within two weeks) from receipt of the letter. Mail your letter certified, return receipt, and keep a copy for your records. If your insurance company denies coverage or offers only partial coverage for your damage, consider negotiating with the agent. Be aware that insurance policies are considered “contacts of adhesion” (where the company has all the bargaining power and uses it to write the contract primarily to its advantage), and therefore, any ambiguity in its terms will be construed liberally in favor of the objectively reasonable expectations of the insured or other layperson and against the insurer. United Policyholders (http://www.uphelp.org), a non-profit organization informing, educating and guiding consumers on insurance matters and through the claims process (including Hawaii consumers during its recent disasters), is an excellent resource for tools and assistance to better negotiate a claim with an insurance company. Another helpful resource is the Hawaii Office of Consumer Protection (Hilo #933-0910; Honolulu toll-free # 947-4000, ext. 74272#, or http://cca.hawaii.gov/ocp/consumer-complain)
2) Does it matter whether Iselle was classified as a tropical storm or a hurricane? Both of these weather occurrences are known as cyclones, but whether classified as a hurricane (wind speeds in excess of 74 mph) or a tropical storm (wind speeds between 39 mph to 73 mph) will impact an insurance claim. Wind and rain damage from a tropical storm would normally be covered under most standard homeowner’s policies. But damage caused by a hurricane would require a separately purchased hurricane policy. However, the majority of standard Hawaii homeowner’s policies include a 72-hour rule, which triggers hurricane coverage at the time the National Weather Service issues a hurricane watch or a warning, remains operable 72 hours thereafter, and excludes the availability of standard homeowner’s coverage for storm damages caused during the operable time frame. This explains why so many Big Island homeowner’s, having only standard homeowner’s policies and no separate hurricane policy, could not recover for Iselle storm damages, where the National Weather Service did not lift its hurricane status, declared on August 6th, to a tropical storm until August 8th, excluding the availability of standard homeowner’s policies for another 72 hours, or until August 11th, when all the damage had already been done. Thus, it may be wise to review your policy more carefully, if confused talk to your agent, the Hawaii insurance commissioner or contact United Policy Holders, and make changes to your policy if desirable.
3) How do I recoup damages caused by downed trees? Although much has been said about the Albezia trees (many other tree types also came down), some important areas are worth re-stating. If your own property’s trees caused your damage, make a claim with your homeowner’s insurance. If your neighbor’s trees caused the damage, request the name of his insurance company / agent and contact them to make a claim and request a copy of the policy. If the property is vacant, check the Hawaii Real Property Tax Office website (http://www.qpublic.net/hi/hawaii/) for the name and address of the owner and contact him or her in an attempt to recoup your damages, either through mediation, litigation, or via a claim with their homeowner’s policy, if applicable. If you do sue, whether in small claims court ($5,000 claim limit), district court ($40,000 limit) or circuit court (claims greater than $40,000), you must demonstrate that your neighbor knew or should have known that the trees presented an imminent threat of harm to persons or property and did cause such harm, which amount must be specified.
4) How do I deal with the still standing dangerous trees on neighboring lots? Consider making a formal written demand to your neighbor to cut, trim or remove the trees in a letter, including: a) all facts demonstrating that the standing trees present an imminent threat of harm to persons or property; b) identifying the specific trees and location in relation to both properties; c) a cost estimate to cut, trim and remove the trees; d) a deadline for the neighbor’s response; and e) a statement of intent to cut, trim or remove the trees at the owner’s expense, to be recouped in a later lawsuit, if he or she fails to timely respond. The leading case in Hawaii on this issue (Whitesell v. Houlton, 2 Haw. App. 365) found the neighboring property owner liable for damages caused by his trees to the plaintiff’s property and also for the plaintiff’s costs to trim the trees after the neighbor failed to do so after being notified. You might also consider reporting the dangerous tree(s) to the Department of Public Works (http://www.hawaiicounty.gov/pw-complaint/), which is responsible for enforcing Hawaii County Code, Chapter 20, Article 2 regarding the reporting and removal of “unsafe flora”. This ordinance was enacted in late 2013 and shifts much of the burden to address this issue from the affected landowner to the County. It does not, however, actually require the County to remove the unsafe flora. But, the good news is, if the County is able to notify the owners and does remove the tree(s), it will bill the owners or place a lien on their property, saving you the trouble and expense.
5) Can my insurance company cancel my policy or fail to renew it? Under Hawaii’s Insurance Code, an insurer is not required to renew once the policy terminates at its specified expiration date (HRS §431:10-226). Cancellation during the policy term, however, except for failure to pay premiums, is unlawful. Several months ago, the Department of Commerce and Consumer Affairs (DCCA) sent a letter to companies that sell homeowners’ insurance in Puna to remind them that it is contrary to Hawaii law to cancel policies midterm unless for failure to pay premiums. The DCCA also reminded insurers, although it is legal to not renew a policy, to “be good neighbors.” If your insurer cancels your policy, it must give written notice not less than ten days prior to the effective date of cancellation. For policy non-renewal, written notice must be given no less than 30 days prior to the effective date of non-renewal. If your insurer cancels your policy for any other reason besides failure to pay premiums, consider making a written request for justification of the cancellation and identification of the specific authorizing policy section. Also consider making a complaint with the Insurance Commissioner, Insurance Division, DCCA (http://cca.hawaii.gov/ins/) in case of any ambiguity or possible bad faith cancellation.
** Jill Raznov-Wedgwood lives in Puna and works in Hilo as Of-Counsel with the Law Offices of Yeh & Moore, where she practices in the areas of commercial litigation, insurance defense and real property matters. She may be reached at firstname.lastname@example.org. The information in this article is not intended to substitute for consultation with a Hawaii licensed attorney.