Maui wildfire insurance claims already top $1.3 billion

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Property loss claims stemming from the wildfires that ripped through Maui in August have topped $1.35 billion so far, the Hawai‘i Insurance Division reports.

Following the Aug. 8 wildfires, the division asked insurers to share data on losses related to the fires and wind damage. As of Sept. 30, more than 200 surplus lines and property and casualty insurers in the state had reported significant home and auto insurance claims due to the wildfires.

“Behind every claim is a person, a family member, a homeowner, or a business owner,” Insurance Commissioner Gordon I. Ito said in a news release announcing the preliminary loss estimates.

Auto and home insurance claims thus far

Claims data, updated online by the Insurance Division, shows that at the beginning of October, estimated wildfire-related claims totaled:

  • $1,325,539,000 for residential property damage
  • $25,906,000 for personal motor vehicle damage

So far, insurers have paid $676,286,000 of those estimated totals toward homeowners claims, and $22,182,000 for vehicle claims, according to the division’s data.

Disaster risk modeling company Moody’s had predicted shortly after the wildfires that the disasters could generate $4 billion to $6 billion in economic losses. The estimate included costs for property damage, possessions, and interruption of business in the affected areas.

“As initial estimates are refined, and additional losses are uncovered, the cost of the catastrophe to insurers is likely to increase,” said Betsy Stella, vice president of carrier management and operations with Insurify.

Scope of the disaster

The wildfire started on the morning of Aug. 8, when high winds and drought conditions fueled the growth of a small grass fire in the community of Lahaina. That fire ignited when strong winds snapped a live power line.

The wildfires that began in Maui’s Olinda, Kula, and Lahaina communities ultimately burned an estimated 3,453 acres on the island, according to Maui County’s data. County officials estimate 99 people died in the fires; as of Nov. 1, just one remained unidentified.

Some Maui residents and businesses have begun to rebuild, and some families will find closure in the identification of lost loved ones. But the financial effects of the wildfires are likely to last for a long time.

“The economic impact of the disaster will be enormous,” Stella said. “Businesses were destroyed or unable to operate in the aftermath of the fires. Residents’ livelihoods were lost or disrupted. With a fully recovered economy likely years in the future, the catastrophe will have a long-lasting effect.”

The future of Hawai‘i’s insurance industry

In an average year, weather-related events in Hawai‘i cause about $300 million in damages, according to the National Centers for Environmental Information. The Maui wildfire is the second-costliest disaster in the state since 1980. Only Hurricane Iniki, which hit the state on Sept. 11, 1992, caused more damage — $6.8 billion, the NCEI reports.

“As weather-related events continue to increase globally, disasters such as this one are expected to occur more often and be more costly in years to come,” Stella said.

What’s next

The Hawai‘i Insurance Division continues to offer in-person assistance to wildfire-affected residents at the Lahaina Disaster Recovery Center, 8 a.m. to 6 p.m., Monday through Saturday, the division said in a news release.

Homeowners and business owners seeking to rebuild should research the contractors they’re considering before signing a contract, the division said. Hire only licensed contractors and use the Department of Commerce and Consumer Affairs’ BusinessCheck tool to confirm licensing.

This article originally appeared on Insurify and was syndicated by MediaFeed.

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