Insights report: wildfires
Wildfires are rarely out of the news at the moment and their frequency, and intensity, is increasing. Whilst North America and Mediterranean Europe have suffered the most recent devastating losses, the risk of UK wildfires exists and this risk is growing.
Global warming and extreme climate conditions, together with a growing population, will undoubtedly result in more wildfires of greater severity. Although wildfires cannot be prevented, insurers know that effective risk management strategies can significantly mitigate the risks in human and economic losses they pose.
Recommended approaches include developing a co-ordinated, structured approach to the mitigation of losses caused by wildfires with stakeholder groups such as construction, utility companies and insurer bodies.
While the UK does not yet have a specific national wildfire agency or strategy, it is vulnerable to wildfires. However, due to their intermittent frequency, remote locations and poorly documented extent and impact records, it has been largely overlooked by policy makers until recently. With the average annual cost to the Fire and Rescue Services in the UK estimated at up to £55 million ($72.4 million), it is not something for insurers to ignore.
Our insights report seeks to identify and illustrate these risks and suggest recommendations to assist the insurance industry in working with legislators, businesses, communities and individuals to reduce exposure to wildfire losses.