Studies: More Than 2 M California Homes Exposed To Wildfires; Hundreds of Thousands in West at ‘Very High Risk’

More than 2 million homes in California face “extreme wildfire hazards,” over 400,000 of which are in Los Angeles County, according to a study from an insurance industry group.

A separate study shows at least three-quarters of a million homes in the Western U.S. have a high risk of wildfire damage, and hundreds of thousands or homes are at “very high risk.”

Both reports were issued in September by separate groups amid one of the worst fire seasons for the Western Region in recent memory.

CoreLogic’s Wildfire Hazard Risk Report identifies more than 740,000 residences across 13 states in the Western U.S. with high levels of risk for wildfire damage.

Those homes represent a combined property value of more than $136 billion.

Nearly 168,000 homes fall into the “very high risk” category, with a projected aggregated value of more than $32 billion, the report states.

The ongoing drought and several record-setting wildfires this year put the reports in an especially poignant light. Colorado and New Mexico experienced record wildfires, and some experts are predicting a severe wildfire season for California.

California, Colorado and Texas contain the largest number of properties categorized as “very high risk” in the CoreLogic report.

Numeric Scores

The report assigns a numeric score ranging from 1-100 to indicate the level wildfire risk. Those levels account for risk within a property itself, as well as risk in close proximity to the property boundary. When considering the surrounding area, more than 900,000 homes in the Western U.S. can be assigned the highest wildfire risk score, considered 81 and higher. Those properties represent a combined value of more than $161 billion, the report states.

The report examines 13 western states: Arizona, California, Colorado, Idaho, Montana, Nevada, New Mexico, Oklahoma, Oregon, Texas, Utah, Wyoming and Washington. It also keys in on six cities: Los Angeles, Calif; San Diego, Calif; Boulder, Colo; Austin, Texas; Albuquerque, N.M. and Salt Lake City, Utah, as well as the top ZIP Codes at risk within each metro area.

A study by the Insurance Information Network of California and Verisk Insurance Solutions – Underwriting shows a majority of high-risk homes are located in Southern California. However, rural Northern California regions have the highest percentage of homes exposed to extreme fire dangers.

“Nearly 15 percent of the 13.5 million homes in California face severe wildfire risk. That’s nearly as many homes as are in the entire state of Colorado,” Candysse Miller, executive director of the Insurance Information Network of California, said in a statement. “Wildfire risk is not exclusive to mountain or rural communities. Many of these homes are in densely-populated suburban neighborhoods.”

More than 417,000 of these high-risk homes are located in Los Angeles County. Southern California counties represent 53 percent of the high-risk homes statewide.

Northern California has a higher percentage of high-risk homes. The counties of Alpine, Mariposa, Tuolumne and Nevada account for more than 95,000 homes. More than 77 percent of these, or nearly 74,000, are considered high-risk.

The study uses three primary factors that contribute to wildfire risk: Fuels — trees, grasses and brush that feed wildfires were analyzed; slope — the grade of the surrounding land was measured as terrain can influence the speed and intensity of a wildfire; access — a determination was made on the condition and network of roads leading to each individual property.

All properties in California were classified as “low,” “moderate” or “high-risk” for wildfire loss potential.

Statewide, insurers protected more than $3 trillion worth of residential property in 2011, according to the California Department of Insurance. The California FAIR Plan, the insurer of last resort for high-risk properties, insured less than 1.25 percent of it. As a result, private insurers cover nearly 99 percent of the insured residential properties in the state, the study shows.

IINC has available an interactive map on its website, www.iinc.org, that provides a county-by-county breakdown of the number and percentage of homes at risk.

By dollar amount Colorado leads the list for “very high risk” exposure, the CoreLogic report shows. The report shows nearly $12.5 billion in properties in that category.

The state was plagued with wildfires over the summer, with two of the most expensive wildfires in state history striking one after the other. The two most destructive wildfires in Colorado’s history will cost insurers roughly $450 million, according to a regional insurer association. The massive figure for insured losses comes from the total 600 homes destroyed and other damages by the two fires, which raged in June and July.

There is nearly $9.5 billion worth of exposure in California in the “very high risk” category, according to the CoreLogic report.

There are 195,149 residences in Texas in the “high risk” category, and 28,490 in the “very high risk” category, the report shows. New Mexico (9,732), Oregon (9,291), Montana (7,668) and Arizona (7,637) are other western states with a large number of “very high risk” properties.

High Risk L.A.

Of the six cities analyzed in the report, Los Angeles is home to the most single-family residences exposed to wildfire risk, with more than 29,000 properties in the “high” or “very high risk” categories.

The total value of the homes in the two categories combined is estimated to be nearly $10 billion, with Malibu at the top of the list of ZIP Code areas with more than $900 million in potential residential property exposure to wildfire risk, according to the report. Beverly Hills ($578 million), Los Angeles ($447 million) and Topanga ($361 million) were other Los Angeles area cities at the top of the list.

San Diego’s exposure for “very high risk” properties is $284 million, and $2.7 billion for “high risk” properties, the report states.

For Colorado, Boulder tops the list for exposure with $1.8 billion in the “very high risk” category and $462 million in the “high risk” category. Austin tops the list in Texas with $232 million in the “very high risk” category and $4.8 billion in the “high risk” category.

A portion of the CoreLogic report includes a Wildland Urban Interface, which identifies the intersection of potentially high-risk fire areas and large numbers of homes. The report states that just between the years of 1990 to 2008, there were nearly 17 million new homes built in the U.S., of which 10 million were located in the WUI and therefore potentially located near high wildfire risk zones.

CoreLogic’s report was developed to provide the insurance industry, financial services companies, homeowners and others impacted by wildfire outbreaks with a better understanding of wildfire risk in the U.S.