Underwriting Wildfires

Wildfire exposure has gotten the attention of property underwriters across the country. How do you manage this emerging risk? This article highlights important things to consider as part of your underwriting due diligence.

Where Do You Start?

If you grew up in Southern California as I did, wildfires were always part of your life. Every year we would have fires, particularly in the foothills of the local mountains. In recent years, however, the frequency and intensity of wildfires have increased dramatically. The impact on local communities and their structures has also increased. This blog highlights two important areas underwriters and brokers should consider when evaluating wildfires in California.    

Change in Wildfire Impact

A recent report from Assured Research “Emerging Trends: Climate Change and Wildfires “1 included two interesting comments regarding wildfires:

  • “15 of the 20 most destructive wildfires in California’s history have occurred since 2000 with 10 of those occurring since 2015.”
  • “The $12 billion of insured loss from the 2018 Camp Fire in California was the world’s costliest event in 2018.”

There are many reasons for the change … some debated, some not. Climate change is the most discussed issue, but just as important is the continued development of housing into brush zones. The insured costs resulting from these events are skyrocketing.

How to Mitigate Risk

How can you manage the risk in your portfolio? A great first step is to visit the California Department of Forestry and Fire Protection (CalFire) website (www.fire.ca.gov). The agency publishes a current fire map (ia.cpuc.ca.gov/firemap/ and incident information. This map is a good starting point for determining how susceptible a given property might be to wildfire. Managing your aggregates within these zones is critical.

Another helpful tool to consider is the insurance platform known as RiskMeter Online (www.riskmeter.com).  Here, you will find data for individual property risk determinations.


Perhaps one of the best underwriting tools is Google Maps (www.google.com/maps), for the following reasons:

  • Google Maps allows you to easily see the property to be insured.  
  • You can assess fire safety issues such as brush clearance from a structure. 
    In fact, a simple Google search will provide you with all brush clearance ordinances in any county in the United States.
    • While brush clearance won’t necessarily save your structure in the event of a truly big and aggressive wildfire, it gives you a fighting chance.
    • For smaller fires, where the embers are not traveling as far and as fast, brush clearance is a big help.
    • In recent fires, we have seen many examples of homes that were spared due to brush clearance when many of their neighbors were not as lucky.

Finally, it’s extremely important to manage your accumulations. Consideration should be given to the per-risk limits. Equally important is careful management of your accumulations in fire zones that can realistically be impacted by the same event.


Wildfire business can be underwritten, but this must be done with special care and consideration.  An astute insurance professional needs to recognize the change in wildfire impact and how to mitigate risk. Proper research and tools will assist underwriters and brokers – as well as insureds.   


1   http://www.assuredresearch.com/news