USA — More than 4.5 million U.S. households are at high or extreme risk from wildfire, according to new analysis by Verisk Insurance Solutions Underwriting, a unit of Verisk Analytic.
The analysis identified the number and percentage of properties at risk from the ten most wildfire prone states the company currently assesses: Arizona, California, Colorado, Idaho, Nevada, New Mexico, Oregon, Texas, Utah and Washington.
California ranked number one with almost 2 million homes at high or extreme risk from wildfire; while Texas ranked second, with 1.3 million households at high or extreme risk.
Percentagewise, Idaho had the highest percentage of households at high or extreme risk from wildfire (24 percent).
The state of Colorado experienced more than $1 billion in insured wildfire losses since 2010 and had the second-highest percentage and third-highest number of households at high or extreme risk from wildfire.
According to Neil Spector, president of Verisk Underwriting, insurer risk remains high despite the fact that the acreage burned in 2013 was lower than in the past several years. Just this past June, insurers incurred nearly $385 million in losses due to the Colorado Black Forest fire.
As losses continue to mount, managing wildfire risk needs to remain a top priority for property insurers, Spector said.
The analysis also noted the largest insured losses sustained within those states:
According to the report, the three factors that contribute to wildfire risk are:
Fuel Grass, trees, or dense brush feed a wildfire. Slope Steeper slopes can increase the speed and intensity of wildfire. Access Dead-end roads can impede firefighting equipment. Verisk conducted the analysis using FireLine, a product that assesses the wildfire risk associated with individual properties by identifying those located within Special Hazard Interface Areas, indicating an increased likelihood of windborne embers and high heat from nearby fuels.
FireLine, a unit of the Verisk Climate division at Verisk Analytics, was used in support of approved property insurance rate filings for individual carriers in California. Results are validated after each significant wildfire, most recently after the Black Forest fire, when it identified every single property destroyed as being at risk from wildfire.