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New Hurricane Insurance Pays Out Even in Close Calls

Wikipedia Commons
Wikipedia Commons

With two months left in Hawaiʻi’s hurricane season, a new type of insurance policy will pay out even if a storm doesn’t damage your home.

First Insurance Company of Hawaii is offering supplemental coverage for hurricanes and tropical storms called FirstTrack. Payments are determined by the insured home’s proximity to a storm and its wind speed.

For example, Hurricane Douglas came within 50 miles of making landfall in July 2020. Oʻahu policyholders with a $5,000 policy limit would have automatically received a payment of $500. Maui and Kauaʻi county residents with the same policy would have received $1,000 since the storm came closer to their shores.

With typical hurricane insurance coverage, after the storm hits, a homeowner or renter will fill out a claim and an adjuster will come out to inspect the damage and receive an estimate on a repair.

Jeffrey Grimmer, vice president of finance at First Insurance, said, "What this FirstTrack product is designed to do is to avoid a lot of those steps and simply say, OK, your island was hit by a Category 1 hurricane. You automatically qualify and we will automatically pay a specified amount."

There are no restrictions on what the money can be used for, and it could offset costs for taking preventative steps like boarding up windows.

He said FirstTrack is a good way to get money to residents faster, which will help the community quickly rebuild.

“Most people have insurance on their home, on their businesses and so on, and will get a lot of money coming in from insurance companies locally and from beyond. And this is just one more way to get money into people’s hands," Grimmer said. "This is probably the quickest way because we don’t have to do the damage assessment, we don’t have to go door to door and go on every roof. The policy will trigger automatically with the storm and the payments will happen within 48 hours of the event passing."

More information can be found at First Insurance Company's website [Link].

Full disclosure: First Insurance Company of Hawaiʻi is an underwriter of HPR.

Jason Ubay is the managing editor at Hawaiʻi Public Radio. Send your story ideas to him at jubay@hawaiipublicradio.org.
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