Willis, a business of WTW, and The Nature Conservancy (TNC) have introduced a $2.5 billion wildfire insurance policy designed to reduce premiums through forest management.
The policy was created for Tahoe Donner Association, a private homeowners’ association in Truckee, California, and is part of an effort to address the growing challenges in California’s insurance market.
Developed in collaboration with the Center for Law, Energy and the Environment (CLEE) at the University of California, Berkeley, the policy links wildfire mitigation practices with lower insurance pricing. It will cover 1,345 acres of Tahoe Donner’s forested and recreational land, offering a 39% reduction in premium and an 89% reduction in deductible compared with traditional policies without forest management.
This initiative comes amid California’s ongoing wildfire crisis. The state faced significant fires in January 2025, including in the Pacific Palisades, highlighting the urgency of addressing wildfire risk.
Thousands of residents had their policies non-renewed just weeks before the fires, and the state’s FAIR Plan has seen residential policies increase by 123% and commercial policies by 161% between September 2020 and September 2024.
David Williams, associate director of Alternative Risk Transfer Solutions at Willis, emphasized the importance of Tahoe Donner’s forest management in reducing risk.
“The forest management work completed by Tahoe Donner, by removing fuel that could burn and leading to a lower fire risk, has considerably reduced the premium and deductible in this insurance policy,” Williams said.
Globe Underwriting, formerly Forest Re, provided the risk assessment data to support the premium reduction.
Kristen Wilson, lead forest scientist at TNC, said the goal is to encourage more insurers to account for the benefits of wildfire mitigation.
“By placing this innovative insurance product, we hope to inspire other insurance underwriters to account for the benefit of thinning and prescribed fire,” Wilson said.
Meanwhile, Dave Jones, director of the Climate Risk Initiative at CLEE and former California insurance commissioner, noted that the policy demonstrates insurers can continue offering coverage in fire-prone areas if mitigation efforts are in place.
