Lawsuit Accuses Lloyd's of London of Hawaiian Home Insurance Scam – NMP
Industry News

Lawsuit Accuses Lloyd's of London of Hawaiian Home Insurance Scam

Jan 10, 2019
The Aloha State is in danger of saying “aloha” to housing unless a new wave of units comes to the market

 
 
A federal class action lawsuit has been filed that accuses Lloyd’s of London and its affiliated insurance brokers of steering Hawaiian homeowners away from the home insurance program established by the State of Hawaii.
 
According to a statement issued by the firm Scott+Scott Attorneys at Law LLP, the lawsuit alleges that Lloyd’s deceived Hawaiian homeowners “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.”
 
Scott+Scott noted that surplus lines insurance policies are made available only when no other home insurance coverage is available. The lawsuit claimed that Lloyd’s and its agents knew that homeowners could have qualified for insurance form the Hawaiian Property Insurance Association (HPIA), but the company pursue a strategy of “artificially inflating coverage limits beyond the $350,000 dwelling coverage limit offered through HPIA.”
 
The 60-page lawsuit added that these actions resulted in commissions that 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.” Lloyd’s did not publicly comment on the lawsuit.
About the author
Phil Hall
Link copied
Published
Jan 10, 2019
Get the NMP Daily
Operations
Pennymac Made $29M. Its Origination Business Lost Money.

Servicing kept the lender profitable in the third quarter as production volume plunged and management accelerated a $160 million cost-reduction plan

Pennymac is cutting jobs and accelerating automation after its mortgage production business swung to a third-quarter loss, even as servicing income kept the company profitable.The lender reported $29 million in net income for the quarter, but its production segment posted a ...

Continue reading
Tech
Rocket's New Tool Lets Brokers Counter Rival Refi Offers On The Spot

Born from a broker's winning Big Pitch proposal, Quick Counter analyzes competing Loan Estimates and generates alternative offers during borrower calls

Rocket Pro's November Power Play introduces Quick Counter, a new application that allows brokers to upload a competing Loan Estimate, compare pricing, and generate a counteroffer while the borrower is still on the phone.Available through Rocket Pro Navigate, the tool support...

Continue reading
Renew your NMLS License — for free.

Enjoy access to a free NMLS renewal class when you attend an in-person event.

Find an event
More from
Industry News
Fed Holds Rates, But Pricing Pressures Persist

Rising Treasury yields and fresh inflation data complicate rate locks, borrower qualification, and lender margins as markets anticipate another hike in December

Industry News
Oct 29, 2026
Zippy Adds Capital For Manufactured-Home Lending Push

The $20 million investment from Saluda Grade will support expansion beyond 27 states and new loan products across wholesale, retail, and community channels

Industry News
Oct 16, 2026
Inflation Hits 3.7%, Putting Mortgage Rate Relief At Risk

September’s inflation pickup puts recent rate improvements at risk, potentially eroding affordability gains from lower home prices and seller concessions

Industry News
Oct 14, 2026
PLACE Acquires Ardley, Expanding Push To Turn Existing Borrowers Into New Loans

The latest deal connects borrower retention technology with Maxwell's origination platform and PLACE's real estate network, creating new opportunities for lenders

Industry News
Oct 09, 2026
Equifax, TransUnion Launch New Tools To Cut Credit Report Costs

Both bureaus introduce ways to purchase credit scores separately from reports, while Equifax reports growing VantageScore adoption and extends $1 pricing through 2028

Industry News
Oct 09, 2026
Newrez, eXp Realty Form Joint Venture To Target Purchase Business

Revenos Mortgage is set to launch in early 2027, replacing eXp's joint venture with Kind Lending

Industry News
Oct 08, 2026