Hawaiian Electric is suing four of its own property insurers over an $80 million coverage fight stemming from the devastating 2023 Maui Wildfires.
The utility giant - which serves 95% of Hawaii's residents - filed the action on February 13, 2026, in the United States District Court for the District of Hawai'i, targeting XL Insurance America, Allianz Global Risks US Insurance Company, the Princeton Excess and Surplus Lines Insurance Company, and General Security Indemnity Company of Arizona. The case is docketed as No. 1:26-cv-00073.
At the heart of the dispute is how losses should be split across a $500 million property insurance program that was structured across two different policy forms. The AEGIS Form accounted for $355 million, or 71% of the program. The HEI Form - used by the four defendant insurers - covered the remaining $145 million, or 29%. According to the filing, the HEI Form generally provides broader coverage than the AEGIS Form, and the two contain what the plaintiffs describe as "substantive coverage non-concurrencies."
That gap matters. The Hawaiian Electric Companies allege that certain losses - including costs related to transmission and distribution assets, spare equipment, and debris removal - are covered exclusively under the HEI Form and not under the AEGIS Form. Yet the four insurers have allegedly refused to pay more than 29% of those losses, treating them as though they should be shared across the entire program. The plaintiffs argue that where coverage exists only under the HEI Form, the HEI Insurers must bear the full cost.
The wildfires, which swept through Maui on August 8, 2023, destroyed much of the historic town of Lahaina. The Hawaiian Electric Companies' Substation 34, its warehouse and office, and transmission and distribution infrastructure in the Lahaina area were wiped out. Fire temperatures allegedly exceeded 1,800°F — more than eight times the maximum rating for the substation equipment. Experts retained by the plaintiffs concluded that returning the equipment to service could risk "arching, sparks, and wildfire."
The plaintiffs estimate the Substation 34 rebuild alone will cost $21.14 million. The insurers, according to the filing, peg repair costs at roughly $7.26 million. The broader claim - now totaling $80,228,334 - also includes approximately $27 million for transmission and distribution assets, $5.68 million for debris removal, $3.84 million for a replacement transformer at another substation, and $844,770 for emergency security and IT costs.
Another layer of contention involves whether the Hawaiian Electric Companies are entitled to replacement cost valuation. The policies reportedly require the insured to commence repairs within two years of loss. The plaintiffs say that timeline is unrealistic given the scale of the disaster, Hawaii's remote location, and regulatory hurdles - and project that the Substation 34 rebuild will not be complete until 2030.
The case spans 17 claims for relief and remains at its earliest stage, with no determination yet made on any of the allegations.
