Insurers lose Kobe fire case

Court rules firms liable for houses burned after quake

Kyodo

The Kobe District Court on Tuesday ordered four nonlife insurance firms to pay a total of 21.4 million yen to three people who lost their homes in a fire that broke out after the Great Hanshin Earthquake devastated the city and surrounding areas in 1995.

A group of 54 plaintiffs — including the three — had demanded that 13 nonlife insurers make payments for the loss of their homes in the fire, which started at a shoe shop in the city’s Higashinada Ward after the quake had struck.

However, the insurers insisted they need not pay out, saying the fires were caused by the earthquake. Fire insurance companies generally insert clauses into their contracts that exempt them from paying out on fires caused by earthquakes.

Presiding Judge Takeshi Mizuno told the court, “Buildings located south of the shoe shop could have caught fire even if there had not been an earthquake,” ordering four insurers, including Yasuda Fire & Marine Insurance Co., to pay the three plaintiffs.

The group of plaintiffs had claimed that the insurers are obliged to provide subscribers with information on the quake exemption clause when they sign contracts.

The judge dismissed the claims of the remaining 51 plaintiffs — whose homes were not neighboring the shoe shop — that their homes would not have caught fire had fire engines not arrived late during the confusion and chaos caused by the earthquake.

According to the ruling, the fire broke out at the shoe shop at around 2 p.m. on Jan. 17, 1995, some eight hours after the quake struck.

Homes and offices around the shop caught fire and 85 of the properties were destroyed, according to the ruling.