Climate Migration--Another Report Showing Insurers Fleeing High Risk Areas--Wildfire

A recently released report, Insurers Retreat as 2025 Wildfire Risk Reaches Dangerous Levels, reiterated that insurers are abandoning high risk areas. The report found,

• When the next extreme wildfires hit – perhaps in the next few months – thousands of uninsured houses may burn down. Regional property markets will collapse: property values will drop.
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•  As of the end of May there were over 200 active fires burning across Canada, half of which were classified as 0% contained or “out of control”.  This wildfire season is ramping up quickly and the data suggest the worst is yet to come.
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• Home insurance premiums have shot up 42% in the most fire prone areas of California.
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• One in five homes in extreme fire risk areas of California has lost coverage since 2019.
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• One in five homes in extreme fire risk areas of California has lost coverage since 2019.
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• Insurance markets are a leading indicator of how financial markets will deal with the climate crisis. Just as insurers won’t do business in key areas now, so too will investors avoid those kinds of risks. Insurance markets may be the first to show the effects of the climate crisis but the disruption won’t stop there.