Vineyards & the Evolving Threat of Wildfire

Wildfire has become a predominant hazard in the United States, with each year seeming to bring more serious events across the country

Vineyards in California, Oregon, and Washington in particular, have suffered devastating wildfires in recent years, leading to an increased need for vineyard wildfire insurance. Between 2015 and 2021, more than 50,000 wildfires occurred across the US each year, with 2017, 2018 and 2020 having 8 out of 10 most destructive and costly wildfires in the country’s history. Burning more than 7 million acres in 2021 alone, concerns are building for upcoming seasons due to current and long-term drought conditions. 

Vineyard owners and wine producers are particularly vulnerable to wildfires. California is the largest wine producer in the US, with the vineyard acreage estimated at 620,000 acres as of 2020 and taking up about 85% of the wine production across the country. Washington and Oregon follow as the second and fifth largest US wine producers. In this regard, ever-increasing temperatures and dryness have and continue to pose a great threat in these regions, especially the West where multiple simultaneous wildfires burnt across California in recent years. 

Beyond devastating property damage, wildfires also cause non-damage business interruption due to smoke taint, strong heat, etc. For instance, even if grapes are not directly burnt by the fires, smoke taint can affect their sugar level in the long term. This keeps  wine producers in the dark about the total losses until long after an event, sometimes years later. With traditional insurers who are already shrinking their capacity and raising the prices, it is challenging for vineyards and producers to get insured for actual material damage, let alone non-damage business interruption. 

Parametric vineyard wildfire insurance offers alternative protection for wine producers 

Descartes collaborates with brokers around the world to insure grape growers, wine producers, cooperatives, distributors, and investors against wildfire exposure, through a unique data driven approach. Also, by covering non damage business Interruption, such as tourism revenue losses, parametric vineyard wildfire insurance allows vineyard owners and grape growers to recoup their losses and build resilience. 

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