Insurers have always been a step behind with their wildfire event response efforts. Namely because of how quickly a wildfire moves and how slowly perimeter data has historically been generated. This means carriers are often left in the dark during an event, not knowing which insureds have been or could be impacted. With the past several years seeing steep increases in the severity of wildfire events—$12 billion in insured losses in California alone in 2018, and nearly that same amount in 2017—now is the time for carriers to ensure every measure is being taken to get in front of this year’s wildfires.
Willis Re, the reinsurance division of Willis Towers Watson, a leading global advisory, broking and solutions company, has deployed a wildfire risk solution that can be used throughout the U.S. to assess location level wildfire risk, and how the risk correlates to the company’s portfolio level wildfire exposure. The new solution supports Willis Re clients to write and price wildfire risk with increased confidence and efficiency for the peril of wildfire.
Following back-to-back years of tragic wildfires, some California residents and business owners may face another crisis—getting adequate and affordable wildfire coverage. Surplus line carriers and the FAIR Plan, for homeowners who can’t get mainstream insurance, are seeing notable spikes in policies. According to the Surplus Line Association of California, in the first three months of this year 19,389 policies with $52.6 million in premiums were sold—up 93 percent and 143 percent respectively over the same period last year. In counties at "very high risk" of wildfires, the FAIR Plan is running 300 percent ahead of last year according to Tammy Schwartz, its vice president for underwriting and operations.
Following back-to-back years of tragic wildfires, some California residents and business owners will face another crisis—getting wildfire coverage—and making sure it’s adequate and affordable. As an insurer, agent, or broker, how do you rise to this challenge? The challenge of helping Californians rebuild and safeguard their homes and businesses, while protecting your own interests. There’s no doubt, insurance plays a key role in California's economy and resilience as wildfire risk continues to evolve. Last August, California Governor, Jerry Brown, stated about fighting wildfires in California: “We’re in for a really rough ride...and we have to apply all our creativity to make the best of what is going to be an increasingly bad situation.”
Technology is shaping better data and analytics for improved wildfire response. Instead of guessing about how a fire has grown and which insureds are impacted, insurers can access regular fire boundary updates within SpatialKey. Up-to-date wildfire perimeter data has historically been a challenge, with insurance professionals resorting to hand-drawn boundaries or custom shapefile creation. Now, insurers can gain a much more accurate and comprehensive understanding of exposure by overlaying the latest fire perimeter data, including multiple models such as RedZone, GeoMac, and NASA data (all available during the latest California fires), with their portfolio data to visualize exposure, apply buffers and filters, and understand TIV and/or policy exposed limits.
Recent wildfires in Northern California, specifically in Napa and Sonoma counties, have sparked widespread devastation across the area to lives, homes, and businesses. Despite the fires still being active, and the numbers still being calculated, this event is already “the deadliest and most destructive series of wildfires in California history,” and among the worst in U.S. history. And with damages estimated between $3 billion and $6 billion (which could still rise), insurers may face another massive payout due to natural catastrophes in 2017. These devastating events are proof that data is the only line of defense for insurers. And, it’s more paramount than ever to gain a better understanding of how you can use data to better mitigate and underwrite wildfire risk going forward.
California wildfires burn a Paras Vineyards building burns in the Napa area Oct. 10, 2017 (courtesy of Josh Edelson/AFP/Getty Images)
This fall, it seems that we can’t catch a break from natural catastrophes and extreme weather. While many people have been eyeing the record-setting hurricanes we’ve seen over the last few months, wildfires in the West are rapidly competing for our attention. Northern California is the latest area to be hit by wildfires, and as of Thursday, they’ve burned for five days straight, with the worst occurring in Napa and Sonoma counties.
IronMan is RedZone’s favorite superhero. And, it’s no wonder because he is, of course, the most data-informed superhero.
If you don't know RedZone, now's the time to become acquainted and here's why: In the U.S. to date (January 1-August 16), 42,010 wildfires have been reported and 6,299,005 acres have burned. Compare this to 3,616,320 for the same period last year. That’s almost double. With staggering numbers like these, insurers need to take a lesson from IronMan and do everything possible to be more data informed.
Fact is, wildfire season is starting earlier, lasting longer, and increasing potential losses. SpatialKey data partner, RedZone, has the wildfire data and accumulation models insurers need to extinguish this ever-increasing threat. Get to know RedZone with this quick 2-minute infographic, and then watch our webinar to learn how the wildfire landscape is changing, and how to leverage wildfire data science to gain new insight.
The risk of wildfire is unlike any other, as today, 90 percent are caused by humans. That’s an alarming amount, considering all it would take is one inexperienced hiker failing to properly extinguish their campfire to scorch an entire mountain.
SpatialKey Inc is pleased to offer its insurance clients access to wildfire risk data from RedZone. RedZone provides the most accurate, up-to-date wildfire intelligence for underwriters, now immediately available in SpatialKey’s geospatial insurance analytics platform.