Ashes to Ashes, Claims to Claims
By Robert Warne - October 29, 2003 As firefighters confront Southern California’s latest fire catastrophe on the front side of the fire lines, adjusters have been feeling the heat on the backside of the fire lines as the claims begin to pour in.
With the fires still blazing it is too early to tell the extent of the damage. Early estimates by some optimists put the current fire’s cost for carriers at about $500 million, much less than the $1.7 billion the 1991 Oakland Hills fire generated in claims.
The fires would have to take a dramatic turn for the worse to come close to Northridge Earthquake’s 630,000 claims that cost insurers over $15 billion.
According to the Long Beach Press Telegram, the Automobile Club of Southern California had received 232 claims by Oct 28, and Farmers Insurance Group reported it had received 900 claims by Oct. 29.
But because the Automobile Club of Southern California’s book of homeowner business is exclusive to the regions affected by the fires, proportionately its loss experience could be the greatest because its risk isn’t spread throughout the state.
State Farm and Allstate Corp. have yet to release any numbers related to their claims.
Aside from homeowner claims there’s bound to be numerous workers’ compensation claims associated with the massive firefighting effort and claims for commercial property loss.
Robert Hartwig, chief economist for the Insurance Information Institute, told the Associated Press that insurers might also have to cover the claims of businesses for losses caused by road closures and other disruptions.
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