Parametric Wildfire Insurance for California

Due to the increasing wildfire insurance coverage gap left by traditional carriers, clients with valuable assets are at extremely high risk.

Climate change is projected to make wildfires more intense and frequent, with a global increase in extreme fires of up to 14% by 2030. The United States experiences many wildfires, where 2022 saw 66,255 wildfires across the region, the highest number in 10 years. A particularly wildfire-prone region in the United States is California. 

California contains the highest number of properties at risk to wildfire due to its extensive size and Mediterranean climate. In 2022 there were five severe wildfire events in California, 3 of which surpassed over $151 million USD in economic loss.

Vulnerabilities in California For High Value Properties

California, with its picturesque landscapes and thriving vineyards, is a magnet for luxury property owners and hospitality businesses alike. However, amidst the allure of wine country and scenic mountain retreats lies a stark reality: the constant threat of wildfires. For hospitality clients, such as resort owners in Napa Valley and beyond, this poses a significant risk to their valuable assets and revenue streams.

Moreover, the wildfire risk extends beyond wine country to encompass luxury properties nestled in the expansive mountains of Los Angeles and Santa Barbara. These properties, often sprawling over vast acres of pristine land, are especially susceptible to wildfires. The combination of high elevation and remote locations amplifies the challenges of wildfire prevention and containment, leaving these properties exposed to substantial damage and loss.

As California’s wildfire risk continues to evolve, traditional insurance carriers have responded by reducing wildfire sub-limits and increasing retentions, leaving clients financially insecure due to limited and expensive coverage.    

In such a landscape of heightened risk and limited coverage, it becomes imperative for property owners in California’s high-value regions to seek robust and tailored insurance solutions to safeguard their investments and livelihoods against the unpredictable forces of nature.

Parametric Wildfire Insurance: A Secure Alternative

Descartes’ parametric wildfire insurance cover, offers fresh capacity to exposed clients needing full financial protection and capacity in the United States and globally. Descartes’ bespoke and customizable parametric covers provide security and consistency in an unstable traditional market.

Check out our case study to see how our parametric cover can provide fresh capacity for exposed hospitality clients in the wildfire-prone region of California.