SACRAMENTO >> The Valley Fire resulted in $700 million in insured losses, according to an initial estimate from the state insurance office released on Monday.
California’s Office of Insurance based the figure upon claims processed through insurance agencies by the end of December. The data includes covered homes, commercial structures, cars, personal property, agricultural losses and other items.
Authorities expect the final tally to be much higher once the final numbers are in, as surplus insurance line claims and damage to public infrastructure — roads, utilities — were not included in the initial estimate.
“I’m not at all surprised because this Valley Fire sought out property with structures on it to burn, it seemed like,” supervisor Jim Comstock told the Associated Press when informed of the reported.
The Valley Fire, along with last summer’s Butte Fire which scorched Amador and Calaveras counties, combined to cost an estimated $1 billion in insured losses.
In terms of size and structures lost, the Valley Fire ranks as the third most damaging wildfire in state history. Comparing insured loss figures, the Valley Fire currently ranks fifth in state annals. The blaze started Sept. 12, 2015 and pillaged 1,958 structures, almost 1,300 of them residential. Another 818 were destroyed or damaged in the Butte Fire.
Four died in the Valley Fire.
“The Valley and Butte fires were sober reminders of the dangers residents can face in rural areas of the state,” said Insurance Commissioner Dave Jones. “A year-round fire season is California’s new reality. Residents and communities, especially those in high-risk fire areas, must take precautions now before the next devastating wildfire strikes.”
Jones issued an Order on Jan. 20 directing the California FAIR Plan to make several changes to better ensure Californians have access to basic property insurance. The commissioner directed the Department of Insurance to review the FAIR Plan in the wake of the Valley and Butte fires.
To date, insurers report they have received 5,600 claims, the majority from Lake County. Insurance companies have paid out more than $500 million overall, and expect to pay an additional $500 million in anticipated future losses after all claims are received, processed and paid.
Insurers are confident that all or most claims resulting from these fires have been reported, but should new claims be filed, these loss estimates may also increase.
Uninsured losses addressed by the Federal Emergency Management Agency and the Small Business Administration will drive the fire’s cost even higher. In addition, the international insurance giant Aon Benfield has pegged economic damage caused by the Valley Fire at $1.5 billion.
Losses from these fires are not expected to impact insurance industry solvency in California. The state’s insurance department continues to monitor wildfire claims.
