Hurricane fund may take hit

Advertiser Staff

News of an increased chance of hurricanes next winter comes as the Legislature considers using money from the Hawai'i Hurricane Relief Fund to balance the budget.

Hurricane 'Iniki in 1992 caused about $1.6 billion in losses, based on insurance payouts. Many insurers stopped providing wind-damage coverage, and the state created the Hawai'i Hurricane Relief Fund in 1993 to provide state-financed insurance.

In the late 1990s, private insurers began to return to Hawai'i to offer coverage, allowing the hurricane fund to close out its business.

Now the Legislature is considering using as much as $100 million of the $217 million in the fund to balance the budget, but some lawmakers and state insurance officials believe another major hurricane strike would again trigger a withdrawal by the insurance industry, meaning the fund would once again be needed to provide coverage.