House Destroyed by Fire... LA Wildfire Insurance Losses "Record High"

Insurance Industry Losses Exceed 43 Trillion KRW
Total Damages Estimated at 400 Trillion KRW

Insurance losses (losses covered by insurance companies) due to the Los Angeles (LA) wildfires are estimated to reach $30 billion (approximately 44 trillion KRW), according to an analysis.

Yonhap News, citing Bloomberg News, reported that major U.S. financial firm Wells Fargo calculated the insurance industry's estimated losses one week after the wildfire outbreak. The amount has increased significantly from last week's maximum estimate of $20 billion. The industry estimates that the number of unemployed due to the wildfires will reach between 15,000 and 25,000.

The billionaire's beach reduced to ashes. Photo by Yonhap News

Wells Fargo expects about 85% of the $30 billion loss to come from homeowners insurance, 13.5% from commercial property insurance, and 1.5% from personal automobile insurance.

Wells Fargo analysts stated, "Regardless of the outcome, we believe insurers can manage losses of this magnitude." They predicted that if total insurance losses reach $40 billion, it would impact insurers' equity capital by 2%.

Major investment bank Goldman Sachs also estimated insurance industry losses to be between $10 billion and $30 billion, and considering uninsured home losses, the total could reach $40 billion.

So far, 24 people have died due to the wildfires. Since fire suppression is not yet complete, the damage could increase further. According to California fire authorities, as of the 12th, the containment rate of the Palisades Fire is 11%, and the Eaton Fire is 27%. The damage caused by the wildfires is estimated at 200 trillion KRW.

Beach house in the Malibu area completely destroyed by wildfire. Photo by AP Yonhap News

The insurance industry expects homeowners insurance companies to bear the largest costs. Total damage and economic loss estimates, including uninsured damages, wage losses, and supply chain disruptions as indirect economic impacts, have also increased significantly over the weekend. Weather information company AccuWeather estimated the losses at $250 billion to $275 billion (approximately 366 trillion to 402 trillion KRW).

Meanwhile, the U.S. National Weather Service (NWS) issued a red flag warning classified as a "Particularly Dangerous Situation" (PDS) for parts of LA County and Ventura County on the same day. The NWS emphasized that these winds could cause "explosive fire growth."

The NWS stated that winds are gradually strengthening from that day, and from 4 a.m. on the 14th to noon on the 15th, some areas are expected to experience strong winds of 89 to 113 km/h.

This content was produced with the assistance of AI translation services.