Expert Analysis: Spokane Wildfires Cause Massive Insured Losses

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A new AM Best report has suggested that the areas in and around Spokane, Washington, will suffer “considerable insured losses” from ongoing wind and fire damage, although it is too early to accurately estimate the magnitude of the losses.

“Three major wildfires, together called the Complex Fire, continue to burn in the area which, as of this writing, has burned over 10,000 acres, destroying more than 700 homes and forcing the evacuation of approximately 65,000 people since it began on August 1, 2026,” AM Best explained in its report.

While the cause of the fires is still being investigated, the rating agency noted that they have been fueled by high winds and hot, dry weather.

According to the report, the magnitude of insured losses will depend on the amount of coverage secured by the affected home and business owners.

“Secondarily, demand surge and ongoing inflationary pressures may drive up insurance claims-related costs,” AM Best added.

AM Best also noted that, as expected, insurance companies whose property portfolios are concentrated in Washington will likely feel the effects of wildfire losses the most.

The rating agency continued, “If the losses are sizable enough, they could result in the homeowners’ insurers in the state being assessed by the state-mandated Fair Access to Insurance Requirements plan (FAIR).

“Washington’s FAIR plan is similar to California’s FAIR plan, as it is not a taxpayer-funded agency, and all insurance companies in the state are required to be members.

“Like California, the assessment rules are that property insurers in the state are assessed based on the share of property insurance premiums they write in the state.”

David Blades, associate director, Industry Research and Analytics, AM Best, said, “In the longer term, depending on the magnitude of the insured losses, primary insurers with a concentration of their homeowners’ or commercial property portfolio in areas within Washington state may re-examine their appetite for wildfire risk given how unpredictable they can be with respect to location, intensity and seasonality.”

The post AM Best expects ‘considerable’ insured losses from Spokane-area wildfires appeared first on ReinsuranceNe.ws.

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