Estimates suggest that the wildfires in Los Angeles could become one of the costliest disasters in US history, with losses already exceeding 135billion and potentially reaching . A report by AccuWeather highlighted the significant impact on an area containing some of the most expensive real estate in the United States.
Insurance and Insured Losses:
Analytical firms like Morningstar and JP Morgan predict insured losses to exceed $8 billion due to property damage. Over 5,300 structures were destroyed by the Palissades Fire, while the Eaton Fire destroyed more than 5,000 additional structures.
Historic Wildfires:
Jonathan Porter, Chief Meteorologist at AccuWeather, described this disaster as one of the costliest wildfires in modern history. These fires rival events like the 2018 Camp Fire in California, which recorded insured costs of approximately $12.5 billion.
The Most Destructive:
US President Joe Biden described these wildfires as “the largest and most destructive in California’s history,” emphasizing that “climate change is a reality.” Biden declared a major disaster in California and held meetings with senior officials to discuss the federal response.
Long-Term Implications:
Experts noted that these wildfires will not be limited to immediate economic impacts but could have long-term effects on public health and tourism. They also deepen the existing crisis in the insurance sector, with companies raising prices or canceling coverage altogether due to increased risks of natural disasters.
Impact on the Insurance Market:
Data from California’s “Fair Plan” program showed that the number of policies issued through the program has doubled since 2020, reaching over 450,000 policies by September 2024. Denise Rappmund, Senior Analyst at Moody’s, stated that this disaster will negatively impact the state’s insurance market, with expectations of increased premiums and reduced availability of coverage.