HI HB1047

Hawaii financial institutions must contact borrowers within 30 days of receiving insurance proceeds from damaged residential property to determine whether funds should pay off the mortgage or be placed in escrow for rebuilding

During governor-declared emergencies, financial institutions must hold insurance proceeds not immediately disbursed in interest-bearing accounts for the borrower's benefit, with interest credited monthly

Mortgage servicers must disburse any insurance proceeds exceeding the mortgage loan balance directly to borrowers, in accordance with investor guidelines

Financial institutions and mortgage servicers are prohibited from charging borrowers fees for maintaining or disbursing interest earned on escrowed insurance proceeds

Effective date is July 1, 2025