Mendocino Complex wildfires cause $56 million of insured losses

Insured losses for properties damaged in the Mendocino Complex wildfires, the largest blazes in state history in terms of acreage, are more than $56 million to date, California Insurance Commissioner Dave Jones said Thursday.

Together with the Carr fire, which burned more than 220,000 acres in Shasta and Trinity counties, insured losses from the July fires total $845 million and are expected to increase.

Those tallies pale in comparison to the nearly $10 billion of insured losses from the North Bay wildfires in October 2017, the costliest fires in American history based on insured losses.

Although the Mendocino and Carr fires are either contained or nearing containment, more disastrous blazes could occur in the state this year, Jones warned at a press conference.

“Fire experts and fire officials tell us that traditionally, the worst and most destructive fires have occurred after Sept.1,” Jones said, as multiple fires are still burning.

“In fact, if you look at Cal Fire’s list of the top 20 most destructive fires in California’s history, 17 of those have occurred after Sept. 1. So while we’ve already had two very destructive fires … the worst may well be yet to come based on past history and experience.”

Jones also on Thursday released an ominous report by climate experts and the state Department of Insurance.

“We’ve seen an increase in severity and frequency of wildfires, and we can also anticipate sea level rise, additional flooding, more droughts; these are the sort of physical impacts of climate change that are a part of our future and present here in California,” he said.

For example, a multiyear drought, the worst in 1,200 years, ended with extreme rainfall, encouraging the growth of the vegetation that fueled wildfires, said Evan Mills, co-author of the report titled, “Trial by Fire: Managing Climate Risks Facing Insurers in the Golden State.” Also, last year’s flames wiped out hillsides, leading to massive mudslides, said Mills, the principal of California-based Energy Associates.

“It’s going to become abundantly clear that the insurance industry is a canary in the proverbial mineshaft when it comes to climate change, but with an important difference - unlike some helpless canaries, the industry can help society confront climate problems,” Mills said. “I think that’s the highest-level takeaway from the report.”

Meanwhile, in the past decade, property insurance companies have declined to renew or write new policies in parts of California considered to be at higher risk for wildfires, Jones said. That likely will continue, while the cost of policies also could increase, the insurance commissioner said.

Though the state Legislature recently approved more consumer protections for homeowner insurance, Jones said some recommendations he made were shot down. He said those included requiring insurers to share with his department the disaster models they use to assess and price property risk, he said. Insurers may not take into account actions residents and communities take to reduce fire risk, like cleaning gutters on houses or creating defensible space, he said.

This year, in the wake of the Mendocino Complex fires - two sister blazes ignited July 27 - more than 3,200 insurance claims have been filed for damage to homes, businesses and vehicles in Mendocino, Lake and Colusa counties. Those claims represent roughly $51.5 million of the total insured losses to date, according to the data Jones released.

The bulk of the 3,008 residential property claims from those fires were for partial damage, including smoke and water, to residential property, while 58 homes were destroyed.

So far, 135 claims have been filed for partial losses to commercial properties, with a single claim for a total loss, comprising more than $4 million in insured commercial losses. The Mendocino fires also burned vehicles, with 128 claims filed for private cars, commercial vehicles and other property types, representing almost $650,000 of insured losses.

Separately, the Carr fire caused $788.9 million of insured losses in Shasta and Trinity counties.

While the Mendocino Complex fires torched a state record as they burned 459,102 acres, the flames headed to wilderness areas after threatening homes, resulting in far less monetary property damage and insured losses than last year’s Tubbs wildfire that devastated Sonoma and Napa counties.

That fire, which the state insurance department considers California’s most destructive wildfire in history, burned 5,636 structures and killed 22 people.

“Some of the fires like the Thomas fire (in Southern California in December 2017) were burning in areas that were uninhabited, so there was a lot of acreage, but not a lot of people living in that space,” said Nancy Kincaid, spokeswoman for the state insurance department. “We saw the same thing with the Mendocino Complex fire.”

You can reach Staff Writer Hannah Beausang at 707-521-5214 or hannah.beausang@pressdemocrat.com. On Twitter @hannahbeausang.