tHE wILDFIRE iNSURANCE cRISIS
1. WILDFIRES CONTRIBUTE TO COSTLY INSURANCE
The rising cost of wildfire recovery and rebuilding are among the reasons home insurers are raising rates, issuing non-renewals and exiting risky locations.
2. HIGH INSURANCE COSTS LEAD TO UNDERINSURED HOMES
In some western states, insurance has increased more than 50% in the last five years. A growing number of homeowners are underinsured or uninsured.
3. THE UNDERINSURED STRUGGLE TO RECOVER FROM DISASTERS
After wildfires, uninsured and underinsured households lack the resources to rebuild, extending the period of displacement.
4. WIthout insurance, home financing is unavailable
Inadequate insurance leads lenders to deny mortgage applications, reducing home ownership and impacting property values
5. INACTION RAISES COSTS FOR LOCAL AND STATE BUDGETS
Delays in rebuilding increase the demand for temporary housing and social services, adding billions to recovery costs.
Declines in home values reduce local services such as police, schools, and street maintenance that rely on property tax revenue.
The need for revenues increases the frequency of emergency allocations, unplanned tax increase and may threaten bond ratings.
SO WHAT NEEDS TO HAPPEN?
COMMUNITY RISK REDUCTION
INVESTING IN COMMUNITY-SCALE WILDFIRE-RESISTANT CONSTRUCTION,
VEGETATION MANAGEMENT AND NEIGHBORHOOD PLANNING CAN MINIMIZE
DAMAGES FROM WILDFIRE AND IMPROVE THE ACCESSIBILTY AND AFFORDABILITY OF INSURANCE.
