Historic wildfires in portions of California last month could cost insurers as much as US$8 billion, according to Aon Benfield’s Global Catastrophe Recap for October.
The report, released on Thursday by Impact Forecasting, the catastrophe modelling development centre of Aon Benfield, noted that the California Department of Insurance has cited that at least 19,000 residential, commercial and auto claims have already been filed, with payouts exceeding US$3.32 billion. “This total was expected to rise to as high as US$8 billion as additional claims are processed,” the report said. “On [an] aggregated basis, this is [the] costliest insured wildfire event ever recorded.”
The outbreak of wildfires in early October killed at least 43 people and injured 185 others. Nearly two dozen fires were ignited as the blazes – notably the Central LNU Complex Fire around the town of Santa Rosa – would “aggregate together as the most damaging event on record in the state,” the report said. Data from Cal Fire (the California Department of Forestry and Fire Protection) indicated that nearly 9,300 structures were damaged, of which more than 8,560 were destroyed. The worst damage was noted in Napa, Sonoma, Mendocino, Lake, Solano, Butte and Yuba counties.
Another significant wildfire outbreak – this time in central and northern Portugal – killed at least 45 people as the fires swept through several districts, notably Coimbra, Viseu and Castelo Branco, causing significant property and commercial damage. The Portuguese Association of Insurers indicated that the total insured losses were likely to reach US$232 million, which would be the costliest event on record for the local industry, the report said. Additional fires caused at least four fatalities in northwestern Spain.
Other events that occurred in October include:
- Hurricane Nate impacted central America in early October, causing at least 46 deaths and material losses of up to US$250 million, of which US$185 million was in Costa Rica alone;
- Three notable storms in Europe: Windstorm Xavier impacted northern Germany and western Poland, prompting moderate damage and causing at least seven fatalities. The extratropical remnants of Ophelia, the easternmost Atlantic major hurricane (Category 3+) on record hit the British Isles in mid-October. Finally, windstorm Herwart swept through central Europe, causing at least 10 deaths and hundreds of millions (U.S. dollars) in claims payouts;
- Super Typhoon Lan caused extensive damage in Philippines and Japan, with powerful winds and torrential rainfall. Total economic losses in Japan were likely to exceed US$1 billion;
- Continuous rainfall prompted widespread flooding in China, Thailand and Vietnam, where at least 98 fatalities were reported. At least 121,000 homes were affected by flooding in Thailand alone; and
- Flooding in southern Norway became one of the costliest events for the local industry in recent years. Although no fatalities were reported, the floods caused property damage and widespread disruption and left dozens of people temporarily evacuated or isolated. The Norwegian insurance sector estimated losses at US$63 million, with economic losses estimated at more than US$100 million.
Historic wildfires in portions of California last month could cost insurers as much as US$8 billion
Read complete article California wildfires could cost insurers up to US$8 billion: Aon Benfield | Canadian Underwriter