HI Rev Stat § 431:10C-301 (2021)
2021 Hawaii Revised Statutes|Title 24. Insurance|431. Insurance Code|431:10C-301 Required motor vehicle policy coverage.

Cross References Arbitration; binding arbitration, see § §431:10C-213 and 431:10C-213.5. Law Journals and Reviews  Tort and Insurance "Reform" in a Common Law Court. 14 UH L. Rev. 55 (1992).   §431:10C-301 Required motor vehicle policy coverage. (a) An insurance policy covering a motor vehicle shall provide:  (1) Coverage specified in section 431:10C-304; and  (2) Insurance to pay on behalf of the owner or any operator of the insured motor vehicle using the motor vehicle with a reasonable belief that the person is entitled to operate the motor vehicle, sums which the owner or operator may legally be obligated to pay for injury, death, or damage to property of others, except property owned by, being transported by, or in the charge of the insured, which arise out of the ownership, operation, maintenance, or use of the motor vehicle; provided that in the case of a U-drive motor vehicle, insurance to pay on behalf of the renter or any operator of the insured motor vehicle using the motor vehicle with the express permission of the renter or lessee, sums which the renter or operator may be legally obligated to pay for damage or destruction of property of others (except property owned by, being transported by, or in the charge of the renter or operator) arising out of the operation or use of the motor vehicle unless the motor vehicle is reported stolen by the owner within three days of notification of the incident; provided that the insurer and owner of a U-drive vehicle shall have the right of subrogation against the renter and operator for breach of the rental contract between owner and renter; and provided further that, in the event that any motor vehicle offered for rental or lease is involved in an accident, the lessor shall provide all information it has or obtains relevant to the accident to all other involved parties upon their request, including but not limited to information about the lessee, and the driver of the vehicle if other than the lessee.  (b) A motor vehicle insurance policy shall include:  (1) Liability coverage of not less than $20,000 per person, with an aggregate limit of $40,000 per accident, for all damages arising out of accidental harm sustained as a result of any one accident and arising out of ownership, maintenance, use, loading, or unloading of a motor vehicle;  (2) Liability coverage of not less than $10,000 for all damages arising out of damage to or destruction of property including motor vehicles and including the loss of use thereof, but not including property owned by, being transported by, or in the charge of the insured, as a result of any one accident arising out of ownership, maintenance, use, loading, or unloading, of the insured vehicle;  (3) With respect to any motor vehicle registered or principally garaged in this State, liability coverage provided therein or supplemental thereto, in limits for bodily injury or death set forth in paragraph (1), under provisions filed with and approved by the commissioner, for the protection of persons insured thereunder who are legally entitled to recover damages from owners or operators of uninsured motor vehicles because of bodily injury, sickness, or disease, including death, resulting therefrom; provided that the coverage required under this paragraph shall not be applicable where any named insured in the policy shall reject the coverage in writing; and  (4) Coverage for loss resulting from bodily injury or death suffered by any person legally entitled to recover damages from owners or operators of underinsured motor vehicles. An insurer may offer the underinsured motorist coverage required by this paragraph in the same manner as uninsured motorist coverage; provided that the offer of both shall:  (A) Be conspicuously displayed so as to be readily noticeable by the insured;  (B) Set forth the premium for the coverage adjacent to the offer in a manner that the premium is clearly identifiable with the offer and may be easily subtracted from the total premium to determine the premium payment due in the event the insured elects not to purchase the option; and  (C) Provide for written rejection of the coverage by requiring the insured to affix the insured's signature in a location adjacent to or directly below the offer.  (c) The stacking or aggregating of uninsured motorist coverage or underinsured motorist coverage is prohibited, except as provided in subsection (d).  (d) An insurer shall offer the insured the opportunity to purchase uninsured motorist coverage and underinsured motorist coverage by offering the following options with each motor vehicle insurance policy:  (1) The option to stack uninsured motorist coverage and underinsured motorist coverage; and  (2) The option to select uninsured motorist coverage and underinsured motorist coverage, whichever is applicable, up to but not greater than the bodily injury liability coverage limits in the insured's policy.  These offers are to be made when a motor vehicle insurance policy is first applied for or issued. For any existing policies, an insurer shall offer such coverage at the first renewal after January 1, 1993. Once an insured has been provided the opportunity to purchase or reject the coverages in writing under the options, no further offer is required to be included with any renewal or replacement policy issued to the insured.  (e) If uninsured motorist coverage or underinsured motorist coverage is rejected, pursuant to section 431:10C-301(b):  (1) The offers required by section 431:10C-301(d) are not required to be made;  (2) No further offers or notice of the availability of uninsured motorist coverage and underinsured motorist coverage are required to be made in connection with any renewal or replacement policy; and  (3) The written rejections required by section 431:10C-301(b) shall be presumptive evidence of the insured's decision to reject the options. [L 1987, c 347, pt of §2; am L 1988, c 306, §1; am L 1992, c 123, §4, c 124, §9, and c 221, §1; am L 1993, c 205, §26; am L Sp 1993, c 4, §5; am L 1997, c 251, §38; am L 1998, c 275, §16] Law Journals and Reviews  Nobody I Know Should Have $35,000 B.I. Limits. XXIII HBJ, no. 1, at 89 (1991).  Key Issues in Hawai`i Insurance Law Answered by the Moon Court. 33 UH L. Rev. 779 (2011). Case Notes  Discussed, where insurer not legally obligated to pay uninsured motorist benefits claimed where accident occurred in Thailand, a country outside of motor vehicle insurance policy's territorial limit. 134 F. Supp. 2d 1159 (2001).  Hawaii law applied to the California policy in effect at the time of the insured's accident in Hawaii. Hawaii law allowing stacking of uninsured/underinsured motorist benefits and prohibiting an insurer from offsetting benefits received from other parties was fundamental, and Hawaii had a materially greater interest than California in having its laws applied in interpreting the insurance policy. 903 F. Supp. 2d 1049 (2012).  Neither the addition of the named insureds' third and fourth vehicles nor the addition of their daughter as a covered driver required insurer to make a new offer of uninsured and underinsured motorist coverage to insureds. 911 F. Supp. 2d 947 (2012).  Whether or not: (1) insurer intelligibly advised named insured of the nature of uninsured motorist and underinsured motorist coverage, and (2) insurer apprised named insured that such coverage was available for a relatively modest increase in premium, were issues of material fact. 911 F. Supp. 2d 947 (2012).  Pursuant to subsection (b)(3), insurance coverage for uninsured motorists is "optional coverage". 76 H. 304, 875 P.2d 921 (1994_.  Underinsured motorist coverage was subject to stacking. 77 H. 362, 884 P.2d 1138 (1994_.  Defendant was not a permissive user of insured vehicle and was therefore not a "covered person" under insurance contract. 78 H. 249, 891 P.2d 1041 (1995).  Named insured under an automobile liability insurance policy, who is injured by hit-and-run driver, can be entitled to uninsured motorist benefits thereunder when the named insured is operating a motorcycle at the time of the named insured's accident. 78 H. 325, 893 P.2d 176 (1995).  Car rental agreement not contract for insurance and not source of customer's entitlement to insurance coverage; customer statutorily entitled to minimum motor vehicle insurance coverage required by this section. 82 H. 351, 922 P.2d 964 (1996).  Car rental company, as self-insurer, not subject to subsection (b)(3) and (4); thus, not required to provide uninsured or underinsured motorist coverage to permissive users of its vehicles. 82 H. 466, 923 P.2d 408 (1996).  Mandatory uninsured motorist offer requirements of subsection (b)(3) apply to the minimum requirements of a "no-fault policy" as specified in subsection (a). 82 H. 466, 923 P.2d 408 (1996).  Insurer's offer to stack benefits legally insufficient where offer did not clearly convey that insureds could have obtained same amount of coverage at lower premium by selecting stacking option and failed to inform insureds that stacking was available for a relatively modest increase in premium. 87 H. 307, 955 P.2d 100 (1998).  Section requires that insurer obtain written rejection of stacked coverage; insurer's offer of coverage inconsistent with requirement as offer required insured to affirmatively select, rather than affirmatively reject, stacking option. 87 H. 307, 955 P.2d 100 (1998).  Though insurer was required under this section to offer stacking option at time of renewal of policy, insurer's failure to do so was irrelevant where policy was not in effect at time of accident. 87 H. 307, 955 P.2d 100 (1998).  An underinsured motorist carrier's grounds for denying underinsured motorist benefits under a consent-to-settle provision in an underinsured motorist policy must be reasonable, in good faith, and within the bounds of the intent underlying subsection (b)(4). 90 H. 302, 978 P.2d 740 (1999).  Exhaustion clauses in underinsured motorist policies requiring insured to exhaust tortfeasor's insurance prior to applying for underinsured motorist benefits are void as against public policy. 90 H. 302, 978 P.2d 740 (1999).  It is unreasonable for an underinsured motorist insurance carrier to precondition its refusal to consent to settle upon the failure of the insured to achieve a settlement exhausting the tortfeasor's policy limits. 90 H. 302, 978 P.2d 740 (1999).  When an insured makes a material change to an existing policy after a valid rejection of coverage, the resulting policy is not a renewal or replacement policy within the meaning of subsection (d), and a new offer of coverage is required; whether a material change was made is a fact specific determination based on the totality of the circumstances that includes consideration of the public policies underlying Hawaii's motor vehicle insurance code. 93 H. 210, 998 P.2d 490 (2000).  Trial court correctly ruled that insured was not entitled to uninsured motorist benefits where insured's injuries resulting from being shot from an adjacent parked car did not arise from the operation, maintenance, or use of a motor vehicle. 103 H. 263, 81 P.3d 1178 (2003).  Insurer's refusal to consent to settle in order to protect its subrogation rights, in light of its investigation of factors that would render subrogation more or less favorable to insurer, was reasonable; however, having withheld its consent, insurer had to put itself in the position of insured's subrogee by paying insured the amount of the settlement offer. 111 H. 160, 140 P.3d 393 (2006).  Under the Hawaii motor vehicle insurance statutory scheme, no requirement exists that an injured party exhaust the liability policies of all joint tortfeasors before making a claim against his or her uninsured motorist policy. 88 H. 77 (App.), 961 P.2d 1171 (1998).  Denial of coverage did not violate subsection (b)(4) where policy did not provide coverage for non-named insureds who are injured while not occupying a covered automobile but clearly provided UIM coverage to persons who are injured while occupying a covered automobile. 88 H. 122 (App.), 962 P.2d 1004 (1998).  Where injured employee was a permissive user of the company vehicle of the named insured, was using the truck during the course of employee's employment to get to and from the jobsite where employee was injured and to store and transport the equipment that employee was using as part of employee's duties at the time employee was injured, employee demonstrated "some connection with the insured vehicle", and was thus an insured person who was entitled to uninsured motorist coverage. 118 H. 123 (App.), 185 P.3d 871 (2008).  Construing the language of §431:10C-103 and this section governing uninsured motorist (UM) and underinsured motorist (UIM) insurance according to their plain and commonly understood meaning and in pari materia with § §663-10.9 and 663-11, UM and UIM policies must provide coverage for all damages which an insured is legally entitled to recover from the owner or operator of an uninsured or underinsured motor vehicle, which necessarily encompasses damages for which the owner or operator of an uninsured or underinsured motor vehicle is jointly and severally liable pursuant to § §663-10.9 and 663-11. 120 H. 329 (App.), 205 P.3d 594 (2009).  To obtain underinsured motorist (UIM) coverage in Hawaii, the liability for damages must exceed the total amount of bodily injury liability limits applicable at the time of the loss and the policy limits for uninsured motorist coverage and payments or settlements are not part of that analysis; thus, trial court correctly determined that the joint and several "damages imposed by law" against the driver exceeded the cumulative limits of driver's bodily injury policies, driver met the statutory definition of an UIM, and the insurer therefore was obligated to pay victim UIM benefits to compensate victim for the difference. 120 H. 329 (App.), 205 P.3d 594 (2009).  Where the "other insurance" clause contained in insurer's policy created a priority of coverage among multiple insurers, and did not limit or reduce insurer's liability for uninsured motorist payments to insured, the provision was valid and enforceable under Hawaii law, and the circuit court did not err in denying insured's motion for partial summary judgment. 120 H. 329 (App.), 205 P.3d 594 (2009).  Discussed: 77 H. 117, 883 P.2d 38 (1994); 86 H. 511, 950 P.2d 695 (1998).  Mentioned: 807 F. Supp. 98 (1992).