How wildfire risk and extreme heat is changing the insurance industry

Jul 7, 2023

Multi-million dollar home smolders at the top of a canyon hillside in the aftermath of the Coastal Fire, a wildfire in Laguna Niguel, California, U.S., May 12, 2022. REUTERS/Mike Blake

Extreme weather events such as wildfires have upended the climate models and risk management strategies used by insurers. Image: Reuters/Mike Blake

Daniel Murphy

Risk and Resilience Specialist, World Economic Forum

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Wildfire risk is increasing drastically throughout the US, prompting reductions in insurance coverage in vulnerable states. Image: First Street

A view of flood damaged buildings are seen as U.S. President Joe Biden (not pictured) inspects the damage from Hurricane Ida on the Marine One helicopter during an aerial tour of communities in Laffite, Grand Isle, Port Fourchon and Lafourche Parish, Louisiana, U.S. September 3, 2021. REUTERS/Jonathan Ernst/Pool

Flooded properties in Lafourche Parish, Louisiana, after Hurricane Ida. Image: Reuters/Jonathan Ernst/Pool

Climate adaptation funding (in billions USD) increased substantially over the last decade.

Climate adaptation funding (in billions USD) has increased substantially over the last decade. Image: Climate Policy Initiative

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