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Homeowners of older properties in Hawaii are facing a sudden and costly reality: insurance companies are non-renewing hurricane policies due to outdated building methods. The core issue, as illustrated by a recent case, is that single-wall construction, common in homes built before the 1990s, is now deemed too high-risk for hurricane-prone regions. This shift is part of a broader trend where insurers are reassessingproperties in high-risk areas based on modern construction standards. For affected homeowners, the solution often involves costly upgrades or seeking coverage through last-resort state programs.
Single-wall construction is a building method where individual wood panels serve as both the interior and exterior walls, eliminating the need for a separate frame, insulation, or drywall. Popular in Hawaii for its affordability and ventilation in the tropical climate, this style is now considered structurally inferior. The primary risk, according to insurers, is its limited resistance to wind uplift and flying debris during a hurricane. As building codes evolved to prioritize energy efficiency and durability, double-wall construction—which uses insulation and separate interior walls—became the standard. Industry experts estimate that approximately half of the older homes in Hawaii still feature single-wall construction, making them a primary target for insurance non-renewals.
Insurance providers are systematically reassessing risk in the wake of increasing climate-related disasters. Following events like the Lahaina wildfires, insurers are using updated risk models that place greater emphasis on a home's construction and its expected performance under stress. This reevaluation is not limited to Hawaii; it is occurring in wildfire- and storm-prone states like Florida, California, and Louisiana. As Leslie Kasperowicz, executive editor of Insurance.com, states, "Increased risk and high claim costs are causing insurance companies to pull back or stop writing policies entirely in certain areas." The decision to non-renew a policy is increasingly based on how a home is built, not just its claims history or location.
If you receive a non-renewal notice, you have several paths forward, each with significant financial considerations.
Upgrade the Home's Structure: The most effective long-term solution is to upgrade to modern building standards. For a typical single-wall home, this means a conversion to double-wall construction. According to homebuilder Richie Boudreaux, this renovation averages $100 to $125 per square foot. The process involves building a new interior wall, adding insulation, and installing new exterior siding. While a massive upgrade for the home's safety and efficiency, securing permits can be a lengthy process, sometimes taking over a year.
Implement Targeted Reinforcements: If a full rebuild is not feasible, targeted improvements can mitigate risk. These include:
Seek Alternative Insurance: When upgrades are not immediately possible, a more practical route may be to obtain a bare-bones policy from a provider like the Hawaii Property Insurance Association (HPIA), which acts as a state-backed insurer of last resort.
Before committing to any major project, homeowners should have their property evaluated by a structural engineer and obtain at least three detailed bids from licensed contractors. This due diligence is critical for making an informed financial decision.
Proactive measures are key to maintaining insurability. Based on our experience assessment, adapting your home to climate change is a critical investment. "The most actionable thing you can do is to make sure that your home is resilient enough to reduce risks and make it more insurable," advises Alex Adekola of ReadyAdjuster. For homeowners of older properties, this means considering upgrades before a non-renewal notice arrives. Even incremental improvements can enhance a home's defensibility and appeal to insurers.
The key takeaway is that insurers are now prioritizing a home's construction quality. Investing in resilience upgrades not only helps secure insurance coverage but also significantly protects your property and family from the growing threats of severe weather.
