Marshal fire damage is expected to exceed $2 billion
28 October 2022
Published by: https://localtoday.news
USA – The total financial damage from December’s Marshall Fire is now estimated at over $2 billion, cementing the wildfire as the costliest in Colorado history and making it the 10th costliest in the United States.
State Insurance Commissioner Michael Conway updated the estimate last week during a meeting with people who have lost their homes to wildfires in Colorado in recent years.
In the days after the Marshall Fire destroyed more than 1,000 homes in suburban Boulder County, initial estimates put the total damage at $500 million. An April analysis of insurance coverage for 951 homes destroyed in the Boulder County wildfire raised damage estimates to more than $1 billion.
Now Conway believes that amount will double as he and his associates gain a better understanding of the scale of rebuilding properties lost in Colorado’s most destructive wildfire.
“That number has increased significantly at this point,” Conway said during Friday’s meeting. “We now estimate that the claims will be in the region of $2 billion, if not more.”
The Rocky Mountain Insurance Information Association reports on its website that the Marshall Fire is surpassing Colorado’s costliest wildfires to date, including the 2020 East Troublesome fire in Grand County and the 2012 Waldo Canyon fire in Colorado Springs.
The East Troublesome Fire, which burned nearly 200,000 acres and destroyed 366 homes, is the second deadliest wildfire in state history and caused $543 million in damage to homes and cars, the Insurance Association reported.
Nationally, the Marshall Fire ranks the 10th most costly wildfire in U.S. history and is the only wildfire in Colorado on this list. The others all burned in California, with the 2018 Northern California campfire ranking first with $10 billion in damage, according to the insurance association’s website.
The Marshall Fire erupted on December 30 during a violent storm that brought 100 mph winds amid an extremely dry spell along the Front Range. The 6,000-acre fire killed two people and destroyed 1,084 homes and seven commercial buildings in Superior, Louisville and unincorporated Boulder County, and damaged an additional 149 homes and 30 businesses.
The cause of the fire is not clear.
After the fire, hundreds of homeowners found they did not have adequate insurance to replace their one-time homes. In response to these complaints, the Colorado Division of Insurance examined the policies of 951 homes and found that many were improperly insured.
The department’s analysis estimated three price levels for rebuilding costs — $250 per square foot, $300 per square foot, and $350 per square foot — and found that 67% of homeowners don’t have enough coverage to rebuild at the most expensive estimate. More than half will not have enough to replace their homes at $300 per square foot, and about a third will not have enough insurance at the lowest estimate, the analysis says.
Overall, Marshall firing homeowners could miss out on insurance coverage totaling $155 million, Conway said.
Conway acknowledged that the true amount of insurance losses will not be known until homeowners contract and begin rebuilding. That will take years, but Conway said the insurance department’s analysis was based on estimates from multiple construction companies.
“We’re confident that we know we have a problem and that we need to find solutions to the problem,” he said.
