Rising Costs Highlight the Ongoing Financial Impact
LA Wildfire Claims: Insurance companies have paid $6.9 billion for damages from two massive Los Angeles-area wildfires that tore through the region last month. The California Department of Insurance (CDI) released updated figures on February 13, reflecting a sharp rise from the $4.2 billion reported on January 30.
Thousands of Claims Filed
According to CDI, policyholders have submitted 33,717 claims for home, business, and disaster-related expenses. Additionally, 5,597 auto insurance claims total $73 million in payouts.
Experts predict insured losses will climb, with estimates ranging between $8 billion and $40 billion.
Major Insurers Report Heavy Losses
LA Wildfire Claims: Several major carriers face substantial financial impacts. Mercury Insurance Group expects gross losses of $1.6 billion to $2.0 billion. However, subrogation and reinsurance recoveries may lower its final loss to $325 million or less.
Travelers Companies Inc. projects $1.7 billion in wildfire losses, while USAA, Chubb, Allstate, and State Farm each report over $1 billion in claims.
Meanwhile, the California FAIR Plan, the state’s last-resort insurer, has already paid $914 million to policyholders. It has now requested a $1 billion assessment from admitted market insurers to cover the claims.
Total Economic Damage Could Reach $164 Billion
Beyond insured losses, the total economic impact of the January wildfires is estimated between $95 billion and $164 billion, according to a UCLA report. The financial burden adds pressure to California’s struggling insurance market, which is already facing rising premiums and policy cancellations in wildfire-prone areas.
For more wildfire insurance updates, visit JacobiJournal.com.
Read the California Department of Insurance’s full report here.