California wildfires may no longer be ‘secondary peril’
As the US wildfire costs exceed $10 billion in 2018 for the second year running, wildfires may no longer be a secondary peril, Steve Bowen, Impact Forecasting director and meteorologist at Aon, has suggested.
A series of major wildfires burned across Northern and Southern California in November 2018. The most catastrophic, the Camp Fire in Butte County, largely destroyed the city of Paradise, killing 88 people with dozens of others unaccounted for.
The California Department of Forestry and Fire Protection, CalFire, cited that 19,357 homes and other structures were damaged or destroyed, making the Camp Fire the deadliest and most destructive on record in California. Additionally, three people were killed in the Woolsey Fire as the fire damaged or destroyed nearly 2,000 structures in Ventura and Los Angeles counties.
Total aggregated economic losses for the fires were expected to minimally exceed $10 billion, while insurance claims payouts for wildfires are set to exceed $10 billion in the US for the second year running, Aon noted.
“With annual wildfire industry payouts expected to exceed $10 billion for the second consecutive year in the US, the standard assumption of wildfire being a secondary peril may evolve in the future,” Bowen said.
“While insurers remain firmly in position to handle the volume of claims in the aftermath of recent events, these heightened losses put a further spotlight on the growing risk of the peril around the world. The growth of exposure into known fire locations and the prospect of more weather and climate-driven effects will require continued focus on mitigation initiatives,” he added.
