Under legislative proposal, thousands of Hawaii drivers would have to buy more insurance

HONOLULU (HawaiiNewsNow) – A proposal that would force nearly a third of Hawaii's drivers to buy more auto insurance is moving forward in the state Legislature.

This is despite concerns that higher costs will force more people to drive without coverage.

It is estimated that 3 out of 10 drivers in Hawaii are purchasing less coverage than the law allows, putting them at risk for financial disaster if an accident occurs.

According to Ivan Oye of the Hawaii Association for Justice, an organization of consumer advocates, the minimum property and injury coverages required by law have not changed in nearly 30 years, so they are now much lower than required even for moderately serious accidents. ,

“Especially if it involves an emergency or traumatic event,” Oye said.

“So you know, the current $20,000 in insurance often pays for only a fraction of the damage that occurs and leaves the victim to bear the cost of their injuries.”

State Senator Transportation Chairman Chris Lee agrees that underinsurance is a major issue.

“When the costs (of an accident) exceed the minimum threshold, you're often left with quite significant bills or quite significant legal jeopardy,” Lee said.

House Consumer Protection Chairman Mark Nakashima says minimum coverage also poses a risk to other drivers, who won't be protected in an accident if the poorly insured driver is at fault.

“If they're underinsured or uninsured, I have to bear that burden as well,” he said.

House Bill 1539 proposes to increase the current $20,000 minimum coverage for injuries to $50,000 and $75,000 over three years.

Minimum property damage coverage will increase from $10,000 to $20,000 and then $40,000.

An estimate of the cost was approximately $175-$20 per year added to current premiums.

Insurance industry representatives said that could leave more owners without coverage.

Alison Uoka spoke for the Hawaii Insurers Council.

“It becomes more expensive, and it puts people in a situation where they may not be able to buy it at all,” he said.

Matt Tsujimura of State Farm Insurance said more uninsured drivers will increase the risks and costs to others. “A large portion of drivers in Hawaii will drive without any insurance, which will then prohibit collections from those individuals,” he said.

But lawmakers are skeptical because being uninsured is illegal and financially risky. “I don't think it's realistic that a ton of people will suddenly go without insurance,” Lee said.

Nakashima said people who are gaming the system now, either by being uninsured or canceling insurance after getting a no-fault card, will continue to do so.

Nakashima said, “I think that people who are law-abiding citizens will continue to be people who will continue to have their needs met and will continue to find a way to get it done.”