From Artemis January 10:
Overnight, more details on the scale of the devastation caused by the wildfires burning in the Los Angeles region of California have emerged, with officials saying 10,000 structures have been destroyed across the two main fires, while estimates of losses continue to rise.
Wildfires are still burning and containment percentages remains very low for the main fires burning in the region, while weather forecasters are calling for more red flag fire weather through today (Friday) and also strong winds again next week, raising the spectre of further damage occurring.
There are numerous estimates for insurance market losses circulating, but in general the range appears to be moving towards between $10 billion and $20 billion.
At the same time, some are cautioning that if the wildfires continue to spread over the coming days, with the continuation of critical fire weather, then some are citing a chance that the ultimate insurance and reinsurance industry loss rises above $20 billion.
As we reported yesterday, analysts from J.P. Morgan doubled their estimate for insurance market losses from the Los Angeles wildfires to around $20 billion, perhaps exceeding it yesterday.
In that article we explored some of the exposure sitting in insurance-linked securities (ILS) such as catastrophe bonds, but continued to explain that ILS market losses would likely be a relatively smaller share of the overall.
We can add an estimate from RBC Capital Markets equity analysts to our list, as they have said, “Since the fires are still burning, it is difficult to obtain a full assessment of the damage, but we think this could produce losses of at least $10–20 billion (could be even higher depending on the longevity of the situation).”
It’s worth noting now that all of the estimates seen yesterday were based on figure for the number of structures destroyed by the fires of around 2,000.
Now, fire officials in Los Angeles County have released new information on the number of structures burned by the wildfires and you can multiply that by five.
The two main wildfires that have caused the most damage are the Palisades and Eaton fires, with each now responsible for an enormous and devastating toll.
The Palisades fire, which is around 6% contained, has burned around 20,000 acres and is now deemed responsible for the destruction of over 5,300 structures, according to the LA fire authorities....
....MUCH MORE
