California’s Department of Insurance believes that the significant damage caused by the recent wildfire disaster in Northern California could discourage insurers from issuing new policies in affected areas.
The department earlier this week confirmed that the total insured losses from the fires topped $3.3 billion. The claims for insured losses on residences, businesses and vehicles reflect a threefold increase from data recorded just two weeks ago.
Celebrate excellence in insurance. Join us at the Insurance Business Awards in Chicago.
“Behind each and every one of these claims, and behind the over $3 billion in insured losses claims, are ordinary people,” said state insurance commissioner Dave Jones in a call with reporters. “Tens of thousands lost everything in what has proven to be the deadliest and one of the most costly set of wildfires in our state’s history.”
Jones also remarked that the high level of devastation could make insurers reconsider providing insurance to areas once deemed at low risk of wildfire.
“We may also see, unfortunately, insurance companies updating their models of risk associated with these fires,” he explained. “And that may mean in some cases some insurers will decide to write less insurance in some areas that had traditionally had been viewed as lower risk.”
According to Jones, the residential property insured losses in Sonoma County exceeded $2.6 billion. The insurance commissioner also hinted that the number is likely to increase further as adjusters process more claims.
Residential property losses in Napa County totaled over $266 million, with commercial losses exceeding $3.2 million. In Mendocino County, residential losses exceeded $115 million, while Yuba and Lake Counties had over $48.5 million each in residential losses.
“These numbers are based on actual claims filed with the insurance companies,” Jones exclaimed. “They are not an estimate, they are actual claimed insured losses.”
CNBC reported that the fires spread to at least eight Northern California counties.
Residential insured losses for all the fires totaled just over $3.1 billion, while commercial losses were at $137 million. Auto losses hit over $28 million and farm/agriculture losses exceeded $4.5 million; most of the agricultural losses were recorded in Sonoma and Napa County.
More than 14,700 homes were razed by the fires, as well as 728 businesses, and over 3,600 vehicles – vehicles that include private cars, commercial vehicles, farm equipment and watercraft.
At least 43 individuals died as a result of the fires, including a firefighter,
CNBC said.
Related stories:
Forget $3 billion – California wildfires could cause much higher insured losses, says Aon
Live in California? Get lots of insurance says leading expert
