High court clears path for $4 billion wildfire settlement payments

The Hawaiʻi Supreme Court ruled Tuesday that insurance companies cannot intervene in the $4 billion Maui wildfire settlement, removing a legal hurdle for thousands of survivors awaiting compensation.

The unanimous decision affirms a June 2025 ruling by 2nd Circuit Judge Peter Cahill, who denied a motion by insurers to join the case as independent parties.

The high court held that the insurers — who have paid out billions in claims since the Aug. 8, 2023, fires — do not have a “protectable interest” that allows them to interfere with the settlement between fire victims and defendants, including the State of Hawaiʻi, Maui County and Hawaiian Electric.

Justices concluded that “economic interests alone do not confer intervention rights,” rejecting claims that the settlement fund is insufficient. 

“It’s evident” that “Subrogating Insurers lack a protectable interest justifying intervention by right,” the court said. 

Justice Todd Eddins, writing for the court, said the insurers’ exclusive remedy is to seek reimbursement through liens on the settlement funds, rather than becoming active participants in the litigation. 

“Equitable subrogation presents no common questions of law or fact with these tort claims and the class settlement of those claims,” the opinion says.

Wildfire survivors’ attorney: Pleased with ruling, but frustrated with delays

Maui attorney Cynthia Wong, who represents wildfire survivors, said her clients are “obviously very pleased” with the opinion. 

“The Insurance Carriers have been fighting every step of the way, since we reached the $4 billion settlement, to interfere with the settlement,” Wong said. “The only reason they are interfering is because they want to take more of the money away from the victims in this limited settlement fund.” 

Wong said the interference has delayed victims receiving compensation. 

“The Hawaiʻi Supreme Court made it clear that we have a global settlement, so the carriers’ rights are lien rights only,” she said. “The carriers need to stop their baseless appeals.” 

Wong noted that some carriers have continued to file two other appeals currently pending before state appellate courts. 

“There is no basis for their continued appeals,” Wong said. “We are hopeful that the message has been received.” 

Insurers: We did not cause delays

Attorney Vincent Raboteau, liaison counsel for the Subrogation Plaintiffs, issued a statement Wednesday defending the insurers’ actions and emphasizing the importance of holding negligent parties accountable.

Raboteau pushed back against the contention that the insurance companies are responsible for stalling payments to survivors.

“In both proceedings, the property insurers requested nothing that would delay a wildfire victim to receive compensation directly from the defendants that caused the wildfires,” Raboteau said. “This point has been clearly made throughout the property insurers’ filings and arguments before the Court.”

He clarified that the latest appeal was strictly seeking the court’s acknowledgment of the insurers’ “protected legal interest” regarding the class action proceeding.

Raboteau maintained that the ability of insurers to recover costs is vital for the state’s broader economy.

“We continue to assert the rights of insurers being able to utilize subrogation to make sure that at-fault parties are held accountable for their negligence,” Raboteau said. “Subrogation is essential to maintaining a stable and reliable insurance market for all policyholders and residents throughout Hawaiʻi.”

Settlement background

The $4.037 billion global settlement was announced in August 2024 after several months of mediation overseen by Keith Hunter and retired judges Louis Meisinger and Daniel Buckley. The court appointed them as mediators to oversee most of the Maui wildfire lawsuits.

The settlement resolves the approximately 450 lawsuits filed by individuals, businesses and insurance companies in state and federal courts for fires in Lahaina and Upcountry.

Payouts were held up by insurers asserting “subrogation” rights, which allow them to “step into the shoes” of policyholders to recover costs from a responsible third party. 

Insurers argued they needed to intervene to protect financial interests, claiming the settlement fund might be insufficient to cover their liens. 

The Supreme Court rejected this, ruling that intervention would “derail a complex and delicately balanced settlement” and prejudice the victims. 

“Prompt settlement is vital,” Eddins wrote. “Delay harms victims and erodes overall settlement value for injured plaintiffs, especially those with underinsured or uninsurable injuries.”

Next steps

Wong said attorneys are now working to pave the way for award determinations, with payments potentially issued “within a matter of weeks.” She added: “Our clients are also hopeful and optimistic with the latest ruling.”

A court hearing is scheduled March 6 to address attorneys’ fees for class plaintiffs, individual plaintiffs, and the insurance companies, Wong said. All attorneys are subject to the court’s discretion on the fee, she added.

The case is Nova Burnes, et al. v. Hawaiian Electric Company Inc. and Ace American Insurance Co., et al. (SCAP-25-0000531).