Natural Disasters

Facts + Statistics: Wildfires

Key Facts

  • According to federal data cited by the National Park Service, humans cause about 85 percent of all wildfires yearly in the United States.

Hurricanes: State of the Risk

Hurricanes

A distinguishing feature of the 2023 Atlantic hurricane season is a tug-of-war between a shift from cool- to warm-water conditions in the central Pacific Ocean and exceedingly warm tropical Atlantic waters. These warming conditions are part of a global pattern that is now outpacing anything seen in four decades of satellite observations.

Stemming a rising tide: How insurers can close the flood protection gap

The main drivers of rising flood losses are related to economic growth and urbanization. Coastal development puts more property at risk and eliminates ways for water to flow or to be absorbed. Other factors – such as aging or absent flood-control infrastructure – also affect losses. Extreme weather and rising sea levels exacerbate the threat.

While awareness of weather and climate risk has grown in recent decades and much action is being taken, a lot of work remains to establish a mindset focused on resilience and pre-emptive mitigation.

 

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Tamping down wildfire threats: How insurers can mitigate risks and losses

Wildfires play a complex role in overall climate risk that insurers need to understand and develop strategies to address. Traditional risk transfer isn’t sufficient to address these chaotic, interconnected perils – but ceasing to insure complex risks isn’t a strategy for long-term success. What’s needed are risk reduction, pre-emptive damage mitigation, and a deeper understanding of the evolving nature of this hazard. Insurers are well positioned to lead the way.

 

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Fighting wildfires with innovation

The 2017 and 2018 wildfire seasons were a catastrophic shock to communities, legislators, and insurance companies. This was most evident in California, which suffered the largest and most destructive wildfires in state history. The aftermath of these disasters has led to the question of whether catastrophic wildfires will be the new normal for California and other fire-prone states and, if so, what can be done to mitigate them?

 

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Infographic: Hurricane Deductibles

A printable version of the infographic can be downloaded here.

Infographic: Hurricane Katrina 10 Years Later

Hurricane Katrina made landfall in Louisiana as a Category 3 storm on the morning of August 29, 2005. It was to become the costliest natural disaster in U.S. history, causing widespread wind and flood damage and taking 1,800 lives. Ten years later, are we as a nation any better prepared to meet such megadisasters; what might be the impact of another Katrina today?

Background on: Wildfires

Overview

Fire plays an important role in the life of a forest, clearing away dead wood and undergrowth to make way for younger trees. But for much of the last century, fire-suppression policies have sought to extinguish wildfires as quickly as possible to preserve timber and real estate. This approach has led to the accumulation of brush and other vegetation that is easily ignited and serves as fuel for wildfires.

Background on: Earthquake insurance and risk

Overview

An earthquake is a sudden and rapid shaking of the earth caused by the breaking and shifting of rock beneath the earth’s surface. This shaking can sometimes trigger landslides, avalanches, flash floods, fires and tsunamis.

Millions of people across 42 states are at risk for damage from an earthquake, yet few purchase earthquake insurance to protect their property.

Background on: Hurricane and windstorm deductibles

The Topic

After Hurricane Andrew in 1992, insurers realized that losses from hurricanes could be much higher than they had previously thought. Hurricane Katrina, in 2005, which cost insurers more than $41 billion at the time, confirmed their fears. After these extraordinary losses, reinsurance companies, insurers that share the cost of claims with primary companies, such as homeowners insurers, said that they could not assume so much risk and that primary companies must reduce their potential losses.

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