3 who lost homes in eruptions sue over denied insurance claims

3 who lost homes in eruptions sue over denied insurance claims
Updated: Sep. 4, 2018 at 5:22 PM HST
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PAHOA, BIG ISLAND (HawaiiNewsNow) - On May 25, Susie Osborne lost her beloved home on Mohala Street. She says it was destroyed by fire, then consumed by lava.

But her insurer, Lloyd's of London, denied her fire claim.

She said the denial left her feeling deceived.

"I was just heartbroken, frustrated, concerned, very concerned about the next steps in my life," Osborne said.

Lloyd's of London didn't return requests for comment, but Jeff R. Hall, the adjuster for Affirmative Risk Management appointed on behalf of the company, wrote a letter to Osborne on July 19.

It said, "My investigation has confirmed your premises is a total loss due to the lava flow/volcanic eruption. Unfortunately, your policy excludes coverage for any direct physical damage or indirect physical damage or loss of use that is a result of lava and/or lava flow."

Osborne is the third victim of the eruptions to sue Lloyd's of London after the insurer denied a claim.

Attorney Jeffrey Foster says he expects a dozen more to also file suit.

"Lloyd's would have known that her house burned to the ground by fire not my lava had they come out and actually inspected the property. They would have known that," he said.

Complicating the issue, Lloyd's of London was not certified to do business in Hawaii.

Gov. David Ige says the insurance commissioner is aware of the challenges.

"We need to remind the community that not everyone is licensed to do business in the state of Hawaii. If they're not licensed, then our ability to support individuals is limited," he said.

Separately, Foster says he's now getting calls about some insurance companies denying coverage for homes flooded during Tropical Storm Lane.

"We have hurricanes, we have earthquakes and people need to know what their insurance policy actually covers," he said.

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