The number of properties destroyed by the ongoing California wildfire outbreak has risen by another 8% since yesterday, with the total rising to 18,652 structures, across residential, commercial and other buildings types, largely driven by continued assessment of the Camp fire in Butte County.
Yesterday, we reported that 17,354 properties and other structures had been destroyed by the Camp, Woolsey and Hill wildfires across the state of California, which was a 12% increase on the previous day.
Now, the total has risen by almost 8% again to 18,652, but largely driven by the Camp wildfire as the Woolsey and Hill wildfires are now almost fully contained by fire authorities in the area.
However, given the investigators are turning up addition properties that have been destroyed as they survey the devastation from the Camp wildfire, it is driving up the expected insurance and reinsurance market loss, as earlier estimates have all been made on too few numbers of properties destroyed.
For example, this week catastrophe risk modelling specialist RMS estimated that the eventual insurance and reinsurance industry loss from the Camp and Woolsey wildfires would reach between $9 billion and $13 billion.
That estimate was based on “more than 12,000 homes and businesses,” according to RMS.
As of the latest count, even excluding the “other properties” that are reported by the wildfire authorities but not always fully insured and generally of lower value, the total number of residential and commercial properties burned by these two wildfires now stands at 14,930, a significant increase that suggests the insurance and reinsurance market loss will be towards the upper-end of RMS’ estimated range.
In addition there are the 3,718 minor or other structures and buildings to consider, some of which will be covered by insurance, or have contents that are insured, as well as 862 residential and commercial properties reported damaged.
On top of which the other vectors of insured wildfire loss have to be added as well, such as automotive business lines, demand surge, business interruption, content claims and additional living-expense claims for those who have lost their homes.
It’s hard to imagine the eventual bill for insurance, reinsurance and ILS interests being below $10 billion and becoming increasingly possible that the top-end of RMS’ range could even be breached, once the full damage is understood.
There remain concerns over the forecast rainfall for the area, with warnings of potential landslides in areas where the ground has been burned and cleared, particularly in the Woolsey fire area.
Still, there is no more news on electrical utility PG&E at this stage, aside from the fact the company may be saved from bankruptcy by a bill being pushed by local legislators. After it had reported a second incident of a power line outage that occurred on the morning the Camp wildfire began, the potential for its equipment being deemed liable for causing the blaze seems to be rising.
Whether the utility can escape bankruptcy likely doesn’t have much of a bearing on its insurance and catastrophe bond, leaving both at severe risk should liability be assigned to the utility for any of these fires.
The market still expects that if found liable the utility will erode all of its $1.4 billion of insurance protection, including the $200 million Cal Phoenix Re catastrophe bond. That cat bond has already been marked down as a likely loss by the market.
Read our previous coverage of this wildfire outbreak:
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