It may seem like a lot of money — and it is, in relation to the amount of money circulating in the islands — but in truth, $4 billion is hardly enough to cover the damages done by the devastating West Maui fires of August 2023.

For that reason alone, it’s no surprise that many insurance companies that have paid out or expect to pay claims in Maui fire cases would like to be in prime position when it comes to the $4.037 billion litigation “global settlement fund” that’s being assembled by the state and a hui of other defendants to cover liability for the Maui cases.

On Tuesday, however, Maui Circuit Judge Peter Cahill wisely ruled that insurers will have to seek reimbursement from the primary defendants after fire victims are paid, if there is any settlement money left over. His decision, precedent-setting because of the sheer size of the disaster and number of victims, squares with Hawaii’s legal approach to cases involving damages, death or injury, and must be respected.

This settlement option is the best way forward to resolve the damages issue for fire victims. It has several benefits for those directly affected, and by extension, for Hawaii: placing damaged parties’ needs first; minimizing the stress and trauma that’s inevitably involved in extended legal proceedings; streamlining and speeding the settlement and payout timeline; and not inconsequentially, limiting the costs in time, resources and money involved with wrangling over a settlement.

Parties to the lawsuit must now hash out specific details and formally agree on terms of the $4.037 billion settlement before it can take force. Those insurance company holdouts who have objected to the proposed deal can do the right thing by their clients, and all those harmed by the 2023 Maui disaster, by accepting the Maui court’s order instead of fighting it, joining in settlement talks and easing the way to a final resolution.

Tuesday’s court decision establishes parameters for payouts to victims and survivors of the fire, which caused at least 102 deaths, ravaged homes, businesses and infrastructure throughout Lahaina. The decision also requires the insurance companies that were holdouts — objecting to their place in line under the proposed terms or seeking relief in a separate court action — to join the “global” proceeding, finding that in Hawaii, combining procedures and ensuring fair compensation for those directly harmed is standard procedure.

The proposed settlement also provides that Hawaii’s One Ohana Fund, established to provide families or heirs of people who died with up to $1.5 million as settlement of their claims without requiring courtroom wrangling, will be folded into the total. To date, 47 families have signed up for that fund in exchange for refraining from lawsuits.

The proposed settlement outline was hashed out over months of mediated negotiations between lawyers representing those damaged by the fire and lawyers representing the primary defendants to be held liable for the destructive fire: Hawaiian Electric Industries (HEI), the state, Maui County, Kamehameha Schools, West Maui Land Co., Hawaiian Telcom, and Spectrum/Charter Communications. HEI has agreed to pay $1.99 billion toward the settlement, including $75 million previously pledged to the One Ohana Fund. The state would contribute about $800 million, in addition to a $65 million One Ohana Fund contribution.

The settlement amount was arrived at via mediators’ calculation of the maximum amount that the parties could reasonably and fairly contribute, “based on the facts of the case,” Maui County has stated. These facts included mediators’ judgment as to what Hawaiian Electric Co. could contribute without being forced into bankruptcy, dissolution or sale to an outside party — also a matter of prime interest for the state and the vast majority of HECO’s non-Maui ratepayers.

The potential savings in time and continued trauma for fire victims are clear. In contrast, at last year’s five-year anniversary of the deadly Camp Fire that ravaged Paradise, Calif. — the costliest wildfire in that state’s history, causing an estimated $16.5 billion in damages — settlements to individual survivors were still trickling out at a fraction of the damages they’d been determined to have suffered. Only $12.5 billion of that devastation was covered by insurance. Public utility Pacific Gas & Electric (PG&E) has agreed to pay upwards of $11 billion of all damages, but under rules specific to California and the legal obligations binding PG&E, working out the details of payments and settlements has dragged on for years.

It took nearly two years after the Camp Fire before a preliminary settlement with PG&E was reached. And five years after the fire, last November, public radio outlet CapRadio reported that some survivors “think they won’t ever be paid.”

A quagmire of courtroom conflict can be avoided here by supporting the settlement effort. That’s the most efficient — and most compassionate — path to resolution of an enormously challenging task.