Kevin Van Leer, senior product manager – Model Product Management, RMS
22:00 UTC Thursday, October 12
After four days of active burning throughout the wine growing regions of Northern California, there are still eight fires threatening both lives and significant amounts of exposure. Conditions conducive to fire ignition and spread persist, and have resulted in extreme fire behavior, especially during the nights of Sunday, October 8, and Wednesday, October 11, in which strong, dry Diablo winds were observed. In total, over 100,000 acres have been burned in Napa, Sonoma, and Solano counties alone, with several additional fires ongoing throughout the state of California.
RMS has produced daily perimeter progressions using the latest satellite information, focusing on the impact of the fires in the three counties noted above. The progressions shown in the figure below highlight the rapid growth observed in the initial hours of the fires from Sunday night through Monday morning. The progressions of the fires are a clear indication of the strength and direction of the winds that were present during this period. Also, shown for context is the perimeter of the 2015 Valley Fire that destroyed over 1,900 structures and 76,000 acres. That fire resulted in approximately US$900 million in insured loss, according to Property Claim Services (PCS).
Figure 1: RMS fire progression perimeter derived using satellite imagery and 2015 Valley Fire Perimeter
Using in-house, high-resolution exposure information and the satellite-derived fire perimeters, RMS analysis calculates that the perimeters include approximately 15,000 structures and US$14 billion in total exposure. The table below provides a breakdown of the impacted exposure. The 3,500 structures reportedly destroyed in these fires as of today is in line with RMS historical event research into the fraction of structures within a perimeter that are either damaged or destroyed.
Based on the fire perimeters representative of the information available at the time of this blog post on October 12, RMS estimates an economic loss range between US$3 billion to US$6 billion. Because of the high penetration rate of wildfire coverage in standard residential and non-residential policies, this range also represents an estimate of insured losses. The range includes loss due to property damage, contents and business interruption caused by the burn component of the fires to residential, commercial, and industrial lines of business.
It does not include automobile or agricultural crop losses, smoke damage, or any factor for post-loss amplification. Because of the impacts to the wine industry throughout the region, RMS notes the significant uncertainty regarding the long-term business interruption for this event, which could result in a higher total loss.
It is important to note that these events are still on-going and the perimeters of the active fires may change significantly before containment. Therefore, these exposure and loss estimate are considered preliminary and are representative of the current situations. RMS will continue to provide updates on this event through RMS Owl and this blog.