insurance

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.

Munich Re estimates the insurance and reinsurance industry’s financial toll from natural catastrophe events in 2024 at US $140 billion, while economic losses were far higher at $320 billion.

Losses from the wildfires burning around Los Angeles in California are likely to predominantly fall to primary insurance carriers and more junior reinsurance layers, specialist insurance-linked securities (ILS) manager Twelve Capital has said.

Specialist manager of catastrophe bond and insurance-linked securities (ILS) funds Plenum Investments has said that it does not believe that the ongoing wildfire situation in Los Angeles will have a meaningful impact on the catastrophe bond market.

Equity analysts from investment bank JP Morgan have now doubled their earlier loss estimate for still raging Los Angeles region of California wildfires, now suggesting it could even exceed $20 billion.

More wildfires broke out in the Los Angeles area of California over night meaning the property damage has continued and early estimates from some of the insurance industry focused equity analyst teams suggest a potential industry loss in the $6 billion to as high as $13 billion range.

According to the latest news reports and a statement by the local fire chief, more than 1,100 structures are said to have been destroyed by the wildfires that continue to burn out of control in the Los Angeles, California suburbs.

Chief Executive Officer (CEO) John Neal is to depart from the Lloyd’s market to join broking giant Aon as its new Global CEO of Reinsurance and Global Chairman of Climate Solutions.

The outbreak of dangerous and damaging wildfires in the Los Angeles area of California in the last day brings into focus the subject of potential further erosion for aggregate catastrophe bond attachments, according to cat bond fund manager Icosa Investments.

Even while pricing across the reinsurance market has begun to decline from its historically high levels, broking group Howden believes that the structural changes enacted during the recent hard market are likely to endure.