Monday, January 25, 2021
Hawai'i Free Press

Current Articles | Archives

Monday, December 24, 2018
Lawsuit: Lloyd's of London Kickback Scheme Steered Lava Victims to Worthless Coverage
By Andrew Walden @ 12:21 PM :: 3719 Views :: Hawaii County , Ethics


Case 1:18-cv-00496-ACK-KJM


Filed December 21, 2018

1. This is a class action lawsuit brought by Plaintiffs on behalf of themselves and a Class (defined below) of similarly situated consumers with a residential property located in the State of Hawaii, who purchased a Lloyd’s of London surplus lines homeowner’s insurance policy, which contains numerous exclusions, such as an exclusion for the peril of lava and/or lava flow causing direct or indirect physical damage or loss of use of the insured property (the “Lava Exclusion”), from Defendants Pyramid Insurance Centre, Ltd. (“Pyramid”) and Ilikea LLC d/b/a Moa Insurance Services Hawaii (“Moa”), which was underwritten by Defendants Borisoff Insurance Services, Inc. d/b/a Monarch E&S Insurance Services (“Monarch”) and Specialty Program Group, LLC d/b/a SPG Insurance Solutions, LLC (“SPG”) (collectively, with Moa and Pyramid, the “Broker Defendants”)….

2. Despite known risks that were insurable without resorting to surplus lines insurance, Broker Defendants, together with Lloyd’s and Doe Defendants 1- 100 (collectively, “Defendants”), improperly steered Plaintiffs and the Class into purchasing Lloyd’s surplus lines homeowner’s insurance to insure their homes against peril. These Lloyd’s surplus lines insurance policies, which contained numerous exclusions, including a Lava Exclusion, are essentially worthless – amounting to no coverage at all.

3. As set forth below, solely in order to unjustly enrich themselves, Defendants misrepresented, in bad faith, to Plaintiffs and the Class that Lloyd’s surplus lines insurance was the only homeowner’s insurance available to them without performing the due diligence required under Hawaii law to place surplus lines insurance.

4. In furtherance of their undisclosed scheme to drive profits and commissions and lower payouts for claims, Defendants improperly steered Plaintiffs and the Class into Lloyd’s surplus lines homeowner’s insurance policies by: (a) failing to perform various duties and due diligence, including the duties and due diligence required under HRS §431:8-301(a); (b) omitting that non-surplus lines insurance was available; and/or (c) artificially inflating the amount of coverage beyond the coverage limits provided under non-surplus lines insurance, specifically through the government-established Hawaii Property Insurance Association (“HPIA”).

5. Specifically, the Broker Defendants steered Plaintiffs and the Class into surplus lines insurance policies that were provided by Lloyd’s. Defendants knew that they were not allowed to place Plaintiffs and the Class with surplus lines insurance unless the insurance coverage amounts exceeded the coverage available through traditional insurance carriers, including the state’s own HPIA insurance program. Therefore, since as early as 2012 to the present (the “Class Period”), instead of performing their required duties and due diligence and ascertaining whether comparable non-surplus lines insurance existed, the Broker Defendants and Lloyd’s steered Plaintiffs and the Class to Lloyd’s policies, including by artificially inflating the insurance coverage amounts in the policies – such as, the home value or the personal liability coverage – beyond the HPIA coverage limits so that they could place Plaintiffs and the Class with Lloyd’s surplus lines insurance policies.

6. The Broker Defendants received kickbacks from Lloyd’s for steering Plaintiffs and the Class to the Lloyd’s surplus lines policies in the form of increased commissions. The Broker Defendants’ commissions were directly tied to the amount of premium steered to Lloyd’s, thereby incentivizing the Broker Defendants to maximize the amount of surplus lines insurance placed with Lloyd’s. Defendants’ scheme to steer Plaintiffs and the Class into these surplus lines policies enabled Lloyd’s to maximize the volume of surplus lines premium, thereby increasing its revenues and profits by writing insurance that Lloyd’s otherwise would not be able to write if Plaintiffs and the Class were to obtain nonsurplus lines property and casualty insurance. Steering Plaintiffs and the Class into Lloyd’s surplus lines insurance policies, which inevitably contain numerous exclusions, also served to reduce loss ratios and payouts for claims, which, in turn, increased the Broker Defendants commissions and Lloyd’s profits.

7. Defendants’ unlawful scheme came to light in May 2018, when Kilauea Volcano, which has been erupting continuously since 1983, erupted from new fissures, displacing hundreds of residents in the lower Puna District of Hawaii Island….

read … Complaint




TEXT "follow HawaiiFreePress" to 40404

Register to Vote


808 Silent Majority

ACA Signups Hawaii


Alliance Defending Freedom

Aloha Pregnancy Care Center

American Council of Trustees and Alumni


Antonio Gramsci Reading List

A Place for Women in Waipio

Astronomy Hawaii

Ballotpedia Hawaii

Better Hawaii

Blaisdell Memorial Project

Broken Trust

Build More Hawaiian Homes Working Group

Christian Homeschoolers of Hawaii

Cliff Slater's Second Opinion

Coffee Break

DVids Hawaii

E Hana Kakou Kelii Akina


Fix Oahu!

Follow the Money Hawaii

Frank in Hawaii

Front Page Magazine

Frontline: The Fixers

Genetic Literacy Project

Grassroot Institute

Hawaii Aquarium Fish Report

Hawaii Aviation Preservation Society

Hawaii Catholic TV

Hawaii Christian Coalition

Hawaii Cigar Association

Hawaii Coalition Against Legalized Gambling

Hawaii ConCon Info

Hawaii Credit Union Watch

Hawaii Crop Improvement Association

Hawaii Debt Clock

Hawaii Defense Foundation

Hawaii Family Advocates

Hawaii Family Forum

Hawaii Farmers and Ranchers United

Hawaii Farmer's Daughter

Hawaii Federalist Society

Hawaii Federation of Republican Women

Hawaii Future Project

Hawaii Gathering of Eagles

Hawaii History Blog

Hawaii Homeschool Association

Hawaii Jihadi Trial

Hawaii March for Life

Hawaii's Partnership for Appropriate & Compassionate Care

Hawaii Public Charter School Network

Hawaii Rifle Association

Hawaii Shippers Council

Hawaii Smokers Alliance

Hawaii State Data Lab

Hawaii Together

Heritage Foundation



Hiram Fong Papers

Homeschool Legal Defense Hawaii

Honolulu Navy League

Honolulu Traffic

House Minority Blog

I Vote Hawaii

If Hawaii News

Imua TMT

Inouye-Kwock, NYT 1992

Inside the Nature Conservancy

Inverse Condemnation

Investigative Project on Terrorism

Iowa Meets Maui

Jackson v Abercrombie

Jihad Watch

July 4 in Hawaii

Kahle v New Hope

Kakaako Cares

Kau TEA Party

Kauai Co GOP

Keep Hawaii's Heroes


Land and Power in Hawaii

Legislative Committee Analysis Tool

Lessons in Firearm Education

Lingle Years

Malulani Foundation

Managed Care Matters -- Hawaii

Malama Pregnancy Center of Maui

Mauna Kea Recreational Users Group

Middle East Forum--The Legal Project

Mililani Conservatives for Change

Military Home Educators' Network Oahu

Missile Defense Advocacy

MIS Veterans Hawaii

Muslim Brotherhood in America

NAMI Hawaii


National Christian Foundation Hawaii

National Parents Org Hawaii

National Wind Watch

New Hawaiian

New Zeal

NFIB Hawaii News

No GMO Means No Aloha

Northwest Economic Policy Seminar

Not Dead Yet, Hawaii

Now What I Really Think

NRA-ILA Hawaii

Oahu Alternative Transport

ObamaCare Abortion Hawaii


OHA Lies

Opt Out Today

Pacific Aviation Museum

Patients Rights Council Hawaii

PEACE Hawaii

People vs Machine

Pritchett Cartoons

Pro-GMO Hawaii


Rental by Owner Awareness Assn

Republican Party -- Hawaii State

Research Institute for Hawaii USA

Rick Hamada Show

RJ Rummel

Robotics Organizing Committee

Save Dillingham Airfield

School Choice in Hawaii

Sink the Jones Act

Statehood for Guam

Tax Foundation of Hawaii

The Real Hanabusa

Time Out Honolulu

Trustee Akina KWO Columns

UCC Truths

US Tax Foundation Hawaii Info

VAREP Honolulu

West Maui Taxpayers Association

What Natalie Thinks

Whole Life Hawaii