New study shows how communities in the Wildland Urban Interface can drastically reduce fire risk and reduce insurance premiums

Huge implications for insurance coverage and housing construction in communities in high wildfire-risk areas

Today (April 17) the Bay Area Council announced results from a study conducted by Milliman and CoreLogic on behalf of the Town of Paradise that estimates mitigation measures such as home hardening, zoning reforms, and external buffers could reduce losses due to wildfires up to 75 percent, which could reduce insurance premiums up to 55 percent. The findings are among the first and most expansive to date to quantify the aggregate risk and cost reduction benefits of different measures communities and individual property owners in the wildland-urban interface (WUI) can take to reduce wildfire risk. Today, more than 11 million Californians live in the WUI. Because wildfire risk may contribute up to 70% of average insurance premiums in Paradise, these findings demonstrate what steps Paradise and other communities in the WUI can take to reduce wildfire risk, promote access to affordable insurance, and remain prosperous into the 21st century.

Read the full report here >>

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“Communities in the WUI can be made much safer and more resilient than they are today” said Nancy Watkins, Principal and Consulting Actuary at Milliman, and one of the report’s co-authors. “Advanced modeling shows how communities can adopt building codes and land use measures that significantly reduce wildfire risk, which is an essential step to sustainable insurance in the WUI.”

“California cannot afford to turn its back on communities at high-risk of wildfires” said Jim Wunderman, President and CEO of the Bay Area Council. “This report provides a blueprint for how these communities, which make up roughly a quarter of the state’s population, can safely and affordably build housing and thrive into the 21st century.” 

“This cutting-edge work shows that Paradise can fully recover” said Kevin Phillips, Town Manager for the Town of Paradise. “Recovery includes sustainable and affordable insurance for our residents. The Town and its partners in recovery have developed and are implementing a comprehensive long term wildfire risk mitigation plan. This study shows that we are doing will make a huge difference for insurers in the long run.”

The report, which was supported by a grant from the Bay Area Council Foundation’s California Resilience Challenge, highlighted several steps communities in the WUI can take to reduce risk and become safer places to live, work, and play:

  1. Mitigation actions by individual homeowners, such as keeping vegetation at least five feet away from structures (estimated to reduce losses up to 52.9%).
  2. Wildfire Informed Development Patterns, such as focusing on rebuilding in areas with lower wildfire risk (e.g. a downtown core) and being intentional with land use planning (e.g. using well-maintained internal buffers such as parks) within urban areas (estimated to reduce losses up to 14.5% per property).
  3. External buffers, such as well-maintained areas with low fire spread potential (estimated to reduce losses by up to 34.5%).
  4. When combined and implemented to maximum potential, the above three strategies were found to reduce projected losses in the Town of Paradise by an average 75% per structure, which translates to an average 55% reduction in reduction.

The Town of Paradise was severely damaged by the 2018 Camp Fire, which killed 85 individuals, destroyed more than 18,000 structures, and ranks as the deadliest and the most destructive wildfire in state history. Eight of the ten largest wildfires in California history have occurred since 2017, destroying nearly 50,000 structures and burning of more than 11 million acres—an area approximately equal to the combined size of New Jersey, Connecticut, Delaware, and Rhode Island.

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