Tag Archives: Camp Wildfire

The Sum of Its Parts: Wildfire in Multi-Peril Catastrophe Bonds

Water, wind, and wildfire. It’s been a devastating three months for the U.S.

Total insured losses from Hurricanes Florence and Michael, and the Camp and Woolsey wildfires are estimated by RMS in the range US$18.6 billion to US$28 billion (see table below):

September 1 Hurricane Florence $2.8 – $5.0 billion
October 8 Hurricane Michael $6.8 – $10.0 billion
November 8 Camp Wildfire $7.5 – $10.0 billion
November 8 Woolsey Wildfire $1.5 – $3.0 billion
TOTAL INSURED LOSSES   $18.6 – $28 billion

While California wildfires may seem far removed from Atlantic storms, for capital markets investors the fires may make the difference to how 2018 is remembered. Insurance Linked Securities (ILS) eyes are now trained on multi-peril aggregate catastrophe bonds.

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Fires in Paradise: Exposure Growth and Catastrophe Risk in the Wildland-Urban Interface

Like many communities in California with a mild climate, affordable housing, and scenic wilderness, Butte County (pop. ~230,000) has grown significantly over the past four decades. Broadly, this growth is happening all around the county — both in cities (e.g. Chico, the county seat and largest city, pop. ~94,000) as well as in more rural areas. Looking more closely, however, the specific spatial patterns of Butte’s development reveal conditions that set the stage for the ongoing Camp Fire to become one of the deadliest and most destructive fires in California history.

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Impact of the California Wildfires: Chris Folkman from RMS on CNN’s Quest Means Business

Chris Folkman, senior director of product management at RMS, was interviewed by Paula Newton on CNN’s Quest Means Business program on Monday, November 12, about the impact of the California wildfires.

Paula asked Chris about the range of factors that have made these wildfires so intense, and also about the potential causes of the fires. Chris explained how the fires could have started and how the almost perfect conditions for the fire produced such a rapid spread. For the Camp Fire in Northern California, deaths were caused by the fire’s sheer speed that had overwhelmed residents as they tried to escape from the path of the flames.

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The New Reality of North America Wildfire

Describing the scale and savagery of the wildfires currently burning in California is difficult to do, but a simple recounting of the statistics is a good starting point. They are thus:

At the time of writing, fifteen wildfires are now burning more than 280,000 acres (~113,000 hectares) in California. Collectively, they have laid waste to almost 7,000 homes and businesses. 31 people have died in the fires. 300,000 more were evacuated. 12,000 firefighters are working the front lines, making admirable progress at containment.

The biggest of these events, the Camp Fire (named for the road of its point of origin) is the most destructive wildfire in history, with 6,700 structures burned. During a period of particularly intense wind, it spread at a rate of more than one football field per second. Entire towns in its path are effectively destroyed.

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