The number of US homes destroyed by wildfires has more than doubled since the 1990s. In just the first half of 2024, Texas has already experienced the largest fire in its history. While there are fewer fires today, they are far worse than in previous decades.
Why has there been such an increase in the severity of fires, and what is the wildfire outlook for 2024? Read on to learn about the causes, risks, and how to prevent losses from the damage caused by wildfires.
What is causing the increase?
While forest fires are long-lived and difficult to extinguish, the actual cause of the increasing severity in the wildfire outlook is grass. When lit, grass fires spread rapidly and can outrun firefighting attempts, meaning even though they are typically short-lived, they can cause significant damage in a small timespan. The western region is especially at risk, where grass and shrub fires cause 80% of burned houses.
Location is another key factor. The wildland-urban interface (where unoccupied land and urban development meet) is particularly vulnerable to fires. More than 40 million houses have been built in the interface since the 1990s, representing an increase of almost 50%. The construction of new housing developments in vulnerable areas will negatively impact the wildfire outlook.
Also read: Parametric Insurance: Protection Against California’s Wildfires
What is the wildfire outlook for 2024?
In the short term, hotter-than-average temperatures are predicted to increase the impact of wildfires and hazardous smoke. There have been significant burns in the first half of the year, with a power pole in Texas starting a blaze covering more than 1 million acres. As a result, the first three months of 2024 saw more landmass burned than in the first six months of 2023.
Looking further ahead is challenging, as wildfires are cyclical but never uniform. For instance, 2023 saw a 25-year low in total area burned due to an El Niño, but 2024 is already seeing record-high figures. However, a changing climate and warming atmosphere could affect the wildfire outlook and cause more severe, long-lasting fires in the future.
What are the risks?
The significant effects of severe blazes across the country include:
- Property damage: With the increasing size and severity of fires, property damage is also on the rise. Forty-five million residences sit along the wildland-urban interface, with Los Angeles most at risk. The city has more than 185,000 properties at risk of wildfires, and the reconstruction cost would be upwards of $140 billion. Riverside, San Diego, Sacramento, and San Francisco top the charts, representing more than 430,000 residences and a potential $250 billion in damages.
- Health: The health outcomes from fire and smoke range from burns caused by contact with flames to increased chances of lung infections like COVID-19. Older adults and people living alone are most at risk, while smoke and ash can also travel long distances and affect the air quality of people living far away from the original blaze. These various risk factors make it difficult to pinpoint how fires will affect a given area until the damage is already done.
Also read: Should You Invest in E&S Insurance?
McGowan Parametric Wildfire Insurance
Organizations have come to rely on parametric insurance to offset the potentially disastrous effects of wildfires. This insurance product offers pre-specified payouts that trigger when certain events occur, meaning the right parametric wildfire insurance can provide coverage for any economic loss.
With McGowan Wholesale’s Parametric Wildfire Insurance, organizations can receive up to $10,000,000 in coverage for any economic losses incurred. Coverage is measured through satellites and burnt areas, being 100% payable once the burn area has reached the predetermined radius around the property. Rest easy knowing you are covered for:
- Direct and indirect financial costs
- Damage to roofs, siding, signs, and landscapes
Payment is available in days due to a rapid claims process that doesn’t require a deductible or an Adjuster. Coverage even extends to what would be uninsurable exposures under traditional property policies.
Contact an expert from McGowan today to learn more about how the right insurance can help protect you against a dangerous wildfire outlook.