With residents of Hawaii’s Big Island continuing to deal with the Kilauea eruption – now in its fourth month – concerns about how their homeowners’ insurance works have been raised.
One lawyer believes homeowners are being misled to purchase insurance that does not cover lava and other volcanic hazards – an oversight that comes back to bite them.
Hawaii-based lawyer Molly Ward told Washington Times that some residents have been assured by their insurance agents that while lava is an exclusion in their policies, the resulting fire from the lava will be covered.
“I cannot count how many homeowners told me that their insurance agents told them to not worry about their lava exclusion, because everyone knows that fires burn houses during an eruption,” Ward said.
Pacific Island Insurance agent Amber Lopez explained that there is typically no coverage for cases when the lava directly causes property damage, even if a fire breaks out as a result.
“So in that circumstance, there would be no coverage,” Lopez said. “Because the carrier considers direct [damage] the lava flow and indirect the fire. So that is pretty clean-cut in the way they’re reading the policy.”
In response, Ward says that such exclusions should not be allowed since insurance policies do not block coverage for damage caused by both lava and fire at the same time.
“And we all know that if you come too close to the sun or anything very hot, including lava, you’re going to burn, [and] in our case here, a considerable time before the lava comes,” she pointed out.
To date, Kilauea’s recent eruption has caused at least $5.1 million in damage. More than 700 homes have been ravaged by the eruption, while 20 have been damaged but can still be salvaged, the Hawaii County Office of Housing and Community Development confirmed.