Warming Climate Could Make Wildfire-Prone Homes Uninsurable
By Jessica Wentz at the Sabin Center for Climate Change Law
On October 9, 2017, the Tubbs Fire ripped through Sonoma County, California, destroying nearly 5,000 homes and killing 22 people. It was the most destructive wildfire in California’s history and the largest urban conflagration in the United States since the 1906 San Francisco earthquake fires. And it was only one of approximately 250 wildfires that sparked that same night in Northern California, causing a total of 44 fatalities and more than $9.4 billion in economic damages.
Now, nine months later, the process of reconstruction has begun. Some of the first homes have gone up on burned lots. Many of these lots are located in the “wildland-urban interface”—rural, forested areas on the outskirts of cities that are much more prone to wildfires. Commenters have questioned the prudence of rebuilding in these areas in light of existing fire hazard and predictions of how the warming climate will fuel more frequent and severe wildfires in the western United States. But there are social and economic factors which are driving reconstruction despite the risk—specifically, the emotional attachment of many property owners to the place they call “home” and the fact that property values in the areas remain extremely high (with some lots listed at over $1,000,000).
The availability of insurance is a critical factor for rebuilding. But many areas prone to wildfire are becoming too risky to insure. As noted in a 2017 report from the California Department of Insurance, premiums and wildfire surcharges have increased significantly in the wildland-urban interface, and several major insurers have stopped writing new policies and renewing plans in areas with high wildfire risk. As insurers begin to account for climate change in their wildfire risk models, they will likely become even less willing to issue and renew policies in these areas.