How do brushfire/wildfire scores affect property quotes?
Brushfire or wildfire scores are critical factors in property insurance underwriting and premium determination, especially for properties located in areas prone to wildfires including California and the western United States. These scores assess the risk of damage from wildfires based on various factors, and here's how they affect property insurance quotes:
1. Risk Assessment
Wildfire scores evaluate the likelihood of a property being affected by a wildfire. Factors include proximity to vegetation, topography, historical fire data, climate conditions, and the presence of fire breaks. Higher wildfire scores indicate greater risk, which insurers use to assess the overall hazard level of the property.
2. Increased Premiums for Higher Risk
Properties with higher wildfire scores generally face increased premiums. This is because the higher the score, the greater the potential for damage and claims resulting from wildfires. Insurance carriers charge higher premiums to account for the increased risk of loss.
3. Coverage Availability
In many cases, properties with extremely high wildfire scores may be deemed too risky to insure. Carriers might decline coverage altogether or offer limited coverage. Alternatively, insurers may require specific mitigation measures (such as creating defensible space, installing fire-resistant roofing, or using non-combustible siding) before agreeing to provide coverage.
4. Policy Terms and Conditions
Higher wildfire risk can lead to higher deductibles for fire-related claims. This means property owners might need to pay more out-of-pocket before insurance coverage kicks in. Carriers might also impose lower coverage limits or exclude certain types of coverage for properties in high-risk areas.
5. Incentives for Risk Reduction
Some carriers offer discounts or more favorable terms for properties that implement effective wildfire mitigation strategies. This can include using fire-resistant building materials, maintaining defensible space, and having emergency water sources available. These measures can lower the property's wildfire score and result in reduced premiums.
6. Reinsurance Considerations
Wildfire scores also affect how carriers manage their own risk through reinsurance. Higher scores can lead to higher reinsurance costs, which insurers might pass on to policyholders in the form of higher premiums.
Underwriting varies by state and carrier. Please review carrier underwriting guidelines or contact your Account Manager with any questions.
Additional Resources
Wildfire | National Risk Index (fema.gov)
Fire Hazard Severity Zones | OSFM (ca.gov)