Wildfires ravaged the Western States throughout the summer and fall of 2017. In Montana, over 1M acres, the size of the state of Maryland, burned. Washington and Oregon were in constant states of emergencies as countless wildfires burned. And in California, the Thomas fire in December 2017, after 14,700 homes were damaged/destroyed and $9B insured damages incurred during the fall, burned more acreage than any other blaze in the state’s history.
Prior to all these 2017 blazes, insurers began dropping homeowners due to wildfire risks. The number of homeowners in fire-prone areas who complained of being dropped by insurance plans increased more than +250% during 2010 – 2016. Between 2015 – 2016 alone, the number of homeowners living in 6 of the 24 counties in California with the greatest wildfire risk who lost their insurance coverage increased by 50%.
Dave Jones, the California Insurance Commissioner, said, “The problem of insurance availability is going to expand. Growing rates of non-renewal and rate increases for people in wildfire zones are entering a critical stage.”
Rising insurance premiums due to wildfire risk are a fact of life everywhere in the country. Federal data tells us that the number of acres consumed by wildfires has doubled each year since 2000. The number of people living in fire prone areas has also doubled during the same time period. And the Union of Concerned Scientists warns that increasingly warmer, drier conditions everywhere in the country translates into increasing numbers of wildfires everywhere in the country.
Julie Rochman, president of the Insurance Institute for Business and Home Safety, said, “We used to have in this country a wildfire season. Now we have wildfire risk in multiple states all year long.”
The wildfire insurance problem is too little too late. Once insurance price signals are sent to homeowners, “homes are built, the businesses are built and people are moving in,” said Commissioner Jones. “It’s too late.”
