Modeler: Insured Losses from Woolsey Fire in Southern California at Least $2.5B

Catastrophe risk modeling firm AIR Worldwide on Friday said it estimates that insured losses from the Woolsey Fire in Southern California will be at least $2.5 billion.

Moody’s on Thursday released estimates showing property/casualty insurers and reinsurers total insured losses at $10 billion $15 billion from both the Woolsey Fire and the Camp Fire in Northern California. The fires destroyed more than 20,000 residential and commercial structures, and damaged nearly 1,000 structures.

RMS earlier this month reported insured losses from the wildfires expected to be at $9 billion to $13 billion, including property and auto damage, business interruption, additional living expenses and contents loss. Industry data provider CoreLogic on Tuesday reported total losses from the wildfires in Northern and Southern California could reach from $15 billion to $19 billion.

AIR’s estimate of insured losses is based on the assumption of nearly 100 percent take-up rates in the burned areas. The fact that damage from fire, including wildfire, is included in standard homeowners’ policies in California informs that assumption, according to AIR.

The Woolsey Fire burned 96,949 acres and destroyed 1,643 structures, while another 364 structures were damaged. The cause of the fire is under investigation.

Total economic losses are expected to be higher than the industry insured loss estimate, according to AIR.

“Industry insured losses from the Woolsey Fire could be higher than $2.5 billion due to uncertainty in the payment of additional living expenses resulting from mandatory evacuations, loss of some individual structures outside of the most affected neighborhoods, as well as widespread but lower levels of loss due to smoke, loss of electricity, and damage from suppression efforts,” the AIR report stated.

Related:

• Moody’s Says California Wildfire Losses Will Impact P/C Insurer, Reinsurer 4Q Earnings
• Negative Credit Implications from California Wildfire Could Emerge for Reinsurance, Fitch Says
• Latest Estimates of Insured Losses from California Wildfires at $9B to $13B

Topics California Profit Loss Wildfire