Monday, August 24, 2020

Re/Insurance: California Wildfires Continue To Expand, Threaten Tens of Thousands of Structures

What a difference three weeks makes.
Our July month-end look at the fire season to date was headlined: "U.S. Wildfire Season Running Far Below Average" The stats through July 30 were: Fires: 31,632  Acres: 2,052,246 versus the 10-year average of 3,849,351 acres burned through that date.

Today the National Interagency Fire Center is reporting 38,151 fires and  3,295,697 acres burned through August 23.
We'll be back with the month-end NIFC states next week but right now two posts from Artemis.
First up, August 20:
California wildfires threaten tens of thousands of structures
The California wildfire season threat has ramped up considerably in the last few days, as severe thunderstorms and lightning ignited numerous new wildfires following a spell of hot and dry weather, that now sees tens of thousands of structures and property including high-value homes at-risk.

After the last two severe wildfire seasons in California and the significant insurance and reinsurance market losses they drove, the recent outbreak of fires are perhaps the most serious since. The California wildfire season typically peaks later in the year as well, meaning there is potentially a lot more of the severe wildfire weather and threat to come.

Among the wildfires currently threatening properties and structures, the LNU Lightning Complex collection of fires (started by lightning strikes) around Napa and Sonoma Valley has now burned some 124,000 acres and is threatening 25,000 structures, according to the California fire authorities.
The LNU Lightning Complex wildfire has already destroyed 105 structures, with another 70 reported damaged and is zero percent contained right now.

The CZU Lighning Complex wildfires in San Mateo and Santa Cruz counties has spread to over 25,000 acres, with 8,593 structures considered threatened and 20 so far destroyed. This fire complex, also started by lightning, is zero percent contained as well.

The SCU Lightning Complex wildfires, again started by the storms of the last couple of days, is burning across locations in Santa Clara, Alameda, Contra Costa, San Joaquin and Stanislaus counties.
102,000 acres in size, the burn area of the SCU fires threatens 3,798 properties and is just 5% contained....

And August 24:
California wildfires continue to expand, property damage & losses mounting
Over the weekend the wildfires burning in California have continue to expand, with two of the lightning complex fires now in the top three largest California wildfires on record, while losses due to property damage from the fires are increasing.

Wildfires currently burning in California number well into the hundreds and have burned through more than 1 million acres of land, an astonishing figure for so early on in the season.
In total, the 2020 California wildfire season has burned over 1.4 million acres and destroyed some 3,114 structures to-date.

The LNU and SCU Lightning Complex fires, which were ignited by a period of dry-lightning storms that affected the state during a heatwave, are the two largest fires, each burning more than 300,000 acres so far.

For insurance, reinsurance and insurance-linked securities (ILS) fund interests, the damage from the fires is not yet at levels to particularly trouble the sector. But this wildfire activity so early in the season is concerning and markets will be anticipating another challenging year ahead, with the potential for severe wildfire losses.

The LNU Lightning Complex wildfires, which is made up of fires including the Hennessey Fire, Aetna Fire, Walbridge Fire, Meyers Fire and Round Fire, has now burned through over 347,600 acres and is just 21% contained so far.

It makes the LNU Lightning Complex fires, which are burning in Napa, Sonoma, Solano, Lake & Yolo Counties, the second largest California wildfire on record.

The LNU fires have now destroyed at least 871 structures (residential, commercial and farm buildings), with another 234 damaged and still 30,500 structures under threat.
The SCU Lightning Complex wildfires have now burned almost 334,000 acres, making this the third largest California wildfire on record.

The SCU Complex fire is made up of numerous smaller lightning ignited blazes across Santa Clara, Alameda, Contra Costa, San Joaquin and Stanislaus Counties. It is only 10% contained so far....

For insurance estimates our first pass guess is $100,000 per structure damaged/destroyed.

As stated above, two of the fires currently burning are among California's top ten on record.
Granted, the record is short and the fires are nowhere near the largest in U.S. history :

Historically Significant Wildland Fires

Date Name Location Acres Significance
October 1871 Peshtigo Wisconsin and Michigan 3,780,000 1,500 lives lost in Wisconsin
1871 Great Chicago Illinois undetermined 250 lives lost
17,400 structures destroyed
September 1881 Lower Michigan Michigan 2,500,000 169 lives lost
3,000 structures destroyed
September 1894 Hinckley Minnesota 160,000 418 lives lost
September 1894 Wisconsin Wisconsin Several Million Undetermined, some lives lost
February 1898 Series of South Carolina fires South Carolina 3,000,000 Unconfirmed reports indicate 14 lives lost and numerous structures and sawmills destroyed
September 1902 Yacoult Washington and Oregon 1,000,000 + 38 lives lost
April 1903 Adirondack New York 637,000 Large amount of acreage burned
August 1910 Great Idaho Idaho and Montana 3,000,000 85 lives lost
October 1918 Cloquet-Moose Lake Minnesota 1,200,000 450 lives lost
38 communities destroyed
September 1923Giant Berkley Californiaundetermined624 structures destroyed and 50 city blocks were leveled