Bill Text: HI SB1167 | 2025 | Regular Session | Introduced
Bill Title: Relating To The Hawaii Hurricane Relief Fund.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced) 2025-01-27 - Referred to CPN, WAM/JDC. [SB1167 Detail]
Download: Hawaii-2025-SB1167-Introduced.html
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THE SENATE |
S.B. NO. |
1167 |
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THIRTY-THIRD LEGISLATURE, 2025 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
relating to the hawaii HURRICANE relief fund.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
For residents, climate change risks include an increase in precipitation and intense tropical storms, hotter temperatures, rising sea level, and intensified drought. Accordingly, Hawaii has a compelling state interest in protecting its citizens from climate disasters, extreme weather attributable to climate change, and harms resulting from long-term changes to the climate system. This protection includes affordable access to a functioning insurance market in the State.
The legislature further finds there is also a compelling state interest in preserving public resources for traditional public purposes, which does not include subsidizing the continued operation of the insurance industry. The insurance industry has been destabilized and harmed by the deception of people and entities who have engaged in misleading and deceptive practices about the connection between fossil fuel products and climate change. The State's insurance industry, particularly the property and casualty insurance sector, has been destabilized by large and frequent payouts to policyholders for a variety of events caused by or attributable to the deception of these responsible parties. This instability has led to increased nonrenewal rates and premiums on all islands and for multiple types of insurance policies. Between 2018 and 2023, insurance nonrenewal rates increased by ninety-one per cent in the county of Kauai, two hundred ninety-six per cent in the city and county of Honolulu, one hundred eighty-four per cent in the county of Maui, and seventy per cent in the county of Hawaii.
The legislature further finds that the area burned by wildfires in Hawaii has increased fourfold. Most recently, climate change exacerbated the Maui wildfires, which destroyed the town of Lahaina and killed at least one hundred two people. In the aftermath of this tragic and horrific event, insurance companies operating in Hawaii have already paid out over $2,300,000,000 across more than ten thousand wildfire claims to fire victims, with another $1,000,000,000 of additional insured losses yet to be paid. The scope and scale of damage has led to difficult settlement negotiations in which parties have tried to address how to meet the needs of fire victims, maintain a solvent market for insurance, and keep vital public utilities and educational institutions operating in our communities. Hawaii has a compelling state interest in protecting the integrity of these institutions as they seek to provide relief to harmed and impacted parties.
Climate change has also impacted the amount of water available in key watersheds across the islands. Ongoing drought has created water security issues that are exacerbated by the growing water demand, which may increase up to thirty-six per cent by the end of the century. For example, rainfall in the Nuuanu watershed is projected to decrease by as much as twenty‑seven per cent, and both the Heeia and Na Wai Eha watershed are also experiencing decreases in rainfall, threatening groundwater supplies and drinking water availability.
At Hawaii's shorelines, sea level has risen ten inches on average compared to 1950, and the mean number of days that cause high tide flooding in Honolulu has almost doubled from six to eleven days per year since the 1960s. Almost all the shorelines in Hawaii, approximately ninety-two per cent, are predicted to retreat between one and twenty-four meters by 2050. Researchers predict that shoreline retreat rates have doubled from the historical rate due to sea level rise.
Climate change is also causing more extreme temperatures in Hawaii. The average annual temperature in Hawaii in 2016 was about 1.7 degrees Fahrenheit warmer than the one hundred-year mean from 1917 to 2016. Similarly, global mean sea surface temperature has increased by about 1.8 degrees Fahrenheit over the past century and waters around Hawaii have followed this trend.
The legislature finds that insurance companies operating in the State need to redress the harm that responsible parties have caused through climate disasters, extreme weather attributable to climate change, and harms resulting from long‑term changes to the climate system. Hawaii has a compelling state interest in ensuring that the Hawaii hurricane relief fund and the Hawaii property insurance association, which are both state entities, exercise their subrogation rights to recover from responsible parties that have caused damages due to climate disasters, extreme weather attributable to climate change, and harms resulting from long‑term changes to the climate system. The courts of this State are the appropriate venue to provide this relief. The legislature further declares that these harms related or attributable to climate change should not be deemed acts of God, unforeseeable, or otherwise classified as a force majeure event eligible for litigation limitations or defenses, except as otherwise explicitly and unambiguously provided.
The legislature further finds that for decades, certain people and entities have spread intentional lies, misinformation and disinformation, and misrepresentations about the connection between climate change and fossil fuel-based products, as well as how climate change has directly contributed injuries in this State. Continued lies, misinformation and disinformation, and misrepresentations by these responsible parties pose a threat to the health, safety, and security of Hawaii's residents and visitors. These parties have long known the dangers of fossil fuel‑based products; however, they have continued to deny and lie for profit. Hiding, obfuscating, and denying information to consumers, elected officials, and regulators alike has harmed and continues to harm Hawaii. Hawaii has a compelling interest in protecting consumers from these lies and misleading information, while also encouraging factual and truthful information on how climate disasters and other harms can be attributed to the responsible parties who have spread those falsehoods.
The legislature further finds and declares that:
(1) Individuals and entities involved in the production of fossil fuel products have engaged in a decades-long project to protect their bottom lines with a coordinated effort to deceive the public about the reality of the climate crisis;
(2) Documents unveiled by litigation and investigative journalists demonstrate that those parties were aware of the potentially catastrophic impact of their products from as early as the 1950s. Even though research conducted by their own scientists affirmed the impacts of their business, these parties outright denied that climate change was real, spread disinformation to cast doubt on the science, and fought regulatory action against fossil fuel and fossil fuel products;
(3) The 1970s and 1980s saw the development of a clear scientific consensus that increasing carbon dioxide concentration in the atmosphere would contribute to global warming, and that the heightened carbon dioxide emissions were attributable to fossil fuels. These facts were supported by several fossil fuel industry scientists from different companies such as Exxon and Shell, who presented these findings to their management with warnings that the "present trend of fossil fuel consumption will cause dramatic environmental effects before the year 2050;"
(4) Despite acknowledging that increased carbon dioxide concentrations due to fossil-fuel combustion posed a considerable threat, responsible parties decided not to take steps to prevent the risks of climate change. Instead, they stopped funding major climate research and launched campaigns to discredit climate science and delay actions perceived as contrary to their business interests. These corporations carried out these campaigns by:
(A) Developing public relations strategies that were contradictory to their knowledge and scientific insights;
(B) Engaging in public communications campaigns to promote doubt and downplay the threats of climate change; and
(C) Funding individuals, organizations, and research aimed at discrediting the growing body of publicly available climate science;
(5) From 1970 to 2020, the oil and gas industry responsible parties made nearly $2,800,000,000 a day and $1,000,000,000,000 dollars a year in profit;
(6) Responsible parties currently advertise "green" efforts to the public that mask the lack of real investment in resiliency and energy-source transition and the continued prioritization of the extraction, refinement, and distribution of fossil fuel products;
(7) A December 2022 report by a congressional oversight committee revealed internal documents from senior leaders from the fossil fuel industry that explicitly reject taking accountability for the greenhouse gas emissions associated with their products; and
(8) By conduct and impact, these responsible parties have intentionally obfuscated the truth about climate change and outright deceived the public to continue dependence on fossil fuel products.
The legislature further finds that the intentional lies, misinformation, and disinformation, and misrepresentations by responsible parties about the connection between the products they sell is not political speech, but fundamentally commercial activity with incidental political impact. The legislature finds that these parties must be accountable to those harmed by climate disasters, extreme weather attribute to climate change, and long-term changes to the climate system.
The legislature finds that the Hawaii hurricane relief fund and the Hawaii property insurance association have not exercised their right of subrogation against responsible parties who should be held accountable for substantially contributing to losses associated with climate change due to their misleading and deceptive practices.
It is the intent of this State to provide a judicial forum for the efficient, just, and equitable resolution of insurers' subrogation claims stemming from climate disasters, extreme weather attributable to climate change, and harms resulting from long-term changes to the climate system.
The purpose of this Act is to:
(1) Require the plan of operation for the Hawaii hurricane relief fund to include the filing and litigation of subrogation claims against responsible parties for claims paid by the fund for losses attributable to climate change; and
(2) Require insurance rates for the fund to account for proceeds paid to the fund from subrogation claims.
SECTION 2. Section 431P-7, Hawaii Revised Statutes, is amended by amending subsection (c) to read as follows:
"(c) The plan of operation shall:
(1) Establish procedures for performance of all powers and duties of the fund;
(2) Establish procedures for providing notice to all persons with interests insurable by the fund in the State of the type of insurance available from the fund in the event the fund offers insurance;
(3) Provide for and adopt all necessary forms, including insurance policies to be used by and on behalf of the fund, for use by the fund and servicing facilities;
(4) Adopt actuarially sound rates, based on reasonable assumptions relative to expectations of hurricane frequency and severity and accounting for proceeds paid to the fund from subrogation claims, to be charged for insurance provided by the fund, in accordance with article 14 of chapter 431;
(5) Publish manuals of rules, rates, and rating and classification plans, which shall address mandatory deductibles, limits of coverage, and the classification of risks and rate modifications based on the exposure of insureds;
(6) Establish procedures for receiving and servicing applications to the fund;
(7) Establish procedures for processing and maintaining records of the fund relating to its financial transactions, its agents, its employees, its operations, and all transactions with any servicing facility;
(8) Establish procedures for the collection and remittance of the premiums and return of unearned premiums where applicable;
(9) Establish procedures for the payment of valid claims;
(10) Establish procedures for prorating available funds pursuant to section 431P-15;
(11) Establish procedures for obtaining reinsurance;
(12) Establish procedures to borrow funds; [and]
(13) Develop a plan for the investment of
moneys held by the fund subject to the limitations in article 6 of chapter 431[.];
and
(14) Require the fund to file and litigate subrogation claims against responsible parties for claims paid by the fund for losses from climate disasters or extreme weather attributable to climate change."
SECTION 3. Nothing in this Act shall be construed to limit in any way the enforceability of existing laws concerning insurance, consumer protection, climate, environment, energy, or natural resources, by either the government or other private plaintiffs.
SECTION 4. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 5. This Act shall take effect upon its approval.
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INTRODUCED BY: |
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Report Title:
Hawaii
Hurricane Relief Fund; Insurance Rates; Subrogation Claims
Description:
Requires
the plan of operation for the Hawaii hurricane relief fund to include the
filing and litigation of subrogation claims against responsible parties for
claims paid by the fund for losses attributable to climate change. Requires insurance rates for the fund to
account for proceeds paid to the fund from subrogation claims.
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.
