Background on: Wildfires

Overview

Fire plays an important role in the life of a forest, clearing away dead wood and undergrowth to make way for younger trees, but the risk wildfires pose to people and property is growing as more people move into forested areas once largely uninhabited. These areas, known as the Wildland-Urban Interface (WUI), contain about 44 million houses in the lower 48 states, according to the U.S. Forest Service.

Rising temperatures are also believed to contribute to large, destructive blazes. Warmer weather contributes to wildfire conditions in several ways: dryer and more combustible vegetation, more frequent lightning strikes, an extended fire season; and more intense winds.

Harvard School of Engineering and Applied Sciences researchers have concluded that by 2050 the number of wildfires in the West could rise by 50 percent, and across the U.S. the number would double.

Insured wildfire losses

Damage caused by fire and smoke are covered under standard homeowners, renters and business owners insurance policies and under the comprehensive portion of an auto insurance policy. Water or other damage caused by fire fighters to extinguish the fire is also covered under these policies. In California, the California FAIR Plan covers residential and commercial properties located in brush and wildfire areas. Properties in those areas are subject to higher rates due to increased risk of fire.

Causes of wildfires

As many as 90 percent of wildland fires in the United States are caused by humans, according to the U.S. Department of Interior. Some human-caused fires result from campfires left unattended, the burning of debris, downed power lines, negligently discarded cigarettes and intentional acts of arson. The remaining 10 percent are started by lightning or lava.

Wildfire prevention and mitigation

Researchers are discovering that embers blown by the wind during wildfires cause most of the fires that burn homes. Also, homes that are less than 15 feet apart are more likely to burn in clusters. In such cases, fire is often spread by combustible fences and decks connected to houses, a study by the Insurance Institute for Business & Home Safety (IBHS) found.

Among the preventive features recommended in the IBHS study were noncombustible siding, decking and roofing materials; covered vents; and fences not connected directly to the house. In addition, combustible structures in the yard such as playground equipment should be at least 30 feet away from the house and vegetation 100 feet away.

Properties at risk for wildfires

According to Verisk’s 2017 Wildfire Risk Analysis 4.5 million U.S. homes were identified at high or extreme risk of wildfire, with more than 2 million in California alone.

Charts and graphs

Total Potential Exposure To Wildfire Damage By Risk Category, 2014 (1)

($ billions)

State	Low	Moderate	High	Very high
Arizona	$9.64	$0.98	$1.76	$1.57
California	75.84	61.92	89.35	16.10
Colorado	18.63	11.53	14.58	13.91
Idaho	9.20	5.56	3.71	2.62
Montana	14.63	4.43	2.29	2.40
Nevada	4.24	5.19	4.57	0.16
New Mexico	11.65	4.62	7.07	2.46
Oklahoma	31.92	16.77	0.03	0.00
Oregon	8.24	9.49	11.91	3.20
Texas	59.53	147.68	48.26	6.33
Utah	2.85	3.93	0.77	0.01
Washington	84.07	18.08	2.88	0.51
Wyoming	3.68	2.62	0.49	0.33
Total, states shown	$331.27	$292.81	$187.66	$49.61

(1) Reconstruction value of single-family residences at risk.

Source: CoreLogic, Inc., a data and analytics company.

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Top 10 Most Wildfire Prone States, 2017

By households			By percent of households
Rank	State	Households at high or extreme risk from wildfires (1)	Rank	State	Percent of households at high or extreme risk from wildfires
1	California	2,044,800	1	Montana	28%
2	Texas	715,300	2	Idaho	26
3	Colorado	366,200	3	Colorado	17
4	Arizona	234,600	4	California	15
5	Idaho	171,200	5	New Mexico	14
6	Washington	154,900	6	Utah	14
7	Oklahoma	152,900	7	Wyoming	14
8	Oregon	148,800	8	Oklahoma	9
9	Utah	133,100	9	Oregon	9
10	Montana	133,000	10	Arizona	8

(1) Number of households is based on data from the 2010 U.S. Census.

Source: Verisk Wildfire Risk Analysis used data from FireLine^®, Verisk’s wildfire risk management tool.

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Wildfire Losses In The United States, 2008-2017 (1)

(2017 $ millions)

wildfire_loss_in_the_us_08-17.gif

Wildfire Losses In The United States, 2008-2017

(1) Adjusted for inflation by Munich Re based on the Consumer Price Index.

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Natural Catastrophe Losses In The United States, 2017 (1)

($ millions)

Event	Number of events (2)	Fatalities	Overall losses	Insured losses (3)
Severe thunderstorm	50	85	$25.4	$18.2
Winter storms and cold waves	13	24	2.2	1.2
Flood, flash flood	12	14	0.4	0.1
Earthquake and geophysical	2	1	minor	minor
Tropical cyclone	5	170	123.0	49.1
Wildfire, heat waves and drought	21	62	14.3	9.5
Total	103	356	$165.3	$78.0

(1) As of January 2018.
(2) Events that have caused at least one fatality or losses of $3 million or more.
(3) Based on property losses including, if applicable, agricultural, offshore, marine, aviation and National Flood Insurance Program losses and may differ from data shown elsewhere.

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Top 10 States For Wildfires Ranked By Number Of Fires And By Number Of Acres Burned, 2017

Rank	State	Number of fires	Rank	State	Number of acres burned
1	Texas	9,827	1	Montana	1,366,498
2	California	9,560	2	Nevada	1,329,289
3	North Carolina	5,125	3	California	1,266,224
4	Georgia	3,929	4	Texas	734,682
5	Missouri	3,398	5	Oregon	714,520
6	Florida	3,280	6	Idaho	686,262
7	Mississippi	2,775	7	Alaska	653,023
8	Montana	2,422	8	Oklahoma	502,625
9	Arizona	2,321	9	Kansas	476,306
10	Oregon	2,049	10	Arizona	429,564

Source: National Interagency Fire Center.

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Top 10 Costliest Wildland Fires In The United States (1)

($ millions)

			Estimated insured loss
Rank	Date	Name, Location	Dollars when occurred	In 2017 dollars (2)
1	Nov. 8-25, 2018	Camp Fire, CA	(3)	(3)
2	Oct. 8-20, 2017	Tubbs Fire, CA	(3)	(3)
3	Nov. 8-22, 2018	Woolsey Fire, CA	(3)	(3)
4	Oct. 8-20, 2017	Atlas Fire, CA	(3)	(3)
5	Dec. 4 - 23, 2017	Thomas Fire, CA	(3)	(3)
6	Oct. 20-21, 1991	Oakland Hills Fire, CA	$1,700	$2,788
7	Oct. 21-24, 2007	Witch Fire, CA	1,300	1,517
8	Jul. 23-Aug. 30, 2018	Carr Fire, CA	(3)	(3)
9	Oct. 25-Nov. 4, 2003	Cedar Fire, CA	1,060	1,386
10	Oct. 25-Nov. 3, 2003	Old Fire, CA	975	1,275

(1) Property coverage only for catastrophic fires. Effective January 1, 1997, ISO's Property Claim Services (PCS) unit defines catastrophes as events that cause more than $25 million in insured property damage and that affect a significant number of insureds and insurers. From 1982 to 1996, PCS used a $5 million threshold in defining catastrophes. Before 1982, PCS used a $1 million threshold. As of December 11, 2018.
(2) Adjusted for inflation through 2017 by the Insurance Information Institute using the GDP implicit price deflator.
(3) Loss estimate not yet available from PCS, but a relative ranking is provided.

Source: The Property Claim Services® (PCS®) unit of ISO®, a Verisk Analytics® company, U.S. Bureau of Economic Analysis.

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