kenton brine
Courtesy of NWINSURANCE.ORG
Mike Maltais
Ward media reporter
CHELAN – With wildfire risks accelerating, homeowner insurance costs rising, and coverage becoming increasingly difficult to obtain and maintain, the Chelan Fire and Rescue Commission announced its Oct. 21 issue on wildfire and insurance. Insurance experts were invited to the conference to give lectures.
Kenton Brine is president of the Seattle-based NW Insurance Council. The NW Insurance Council is described on its website (nwinsurance.org) as a nonprofit, member-supported trade association.
“We provide home, auto and business insurance information to consumers, policy makers and the media in Washington, Oregon and Idaho,” Brine said.
He explained what homeowners and renters insurance covers in terms of damage, loss, and liability, and just as importantly, what it doesn’t cover.
The outside of the house is flooded. earthquake. Earth movements (landslides, debris flows, sinkholes).
Brine, whose specialty is residential property and casualty insurance (P&C), said changes are needed to protect homeowners and stabilize the insurance market.
The three major elements of non-life insurance policy provision and services are:
Underwriting – Deciding who to write coverage for and what to cover.
Valuation – The cost of insurance.
Claims – Restructure and replace a covered loss after it has occurred.
In the case of wildfire risk, considerations include:
Evaluation of building materials. Fuel is loaded on or near the property. Must be able to access the facility in case of an emergency. Distance and situation from fire station. Defensible space/home reinforcement.
“Insurance companies are tightening their underwriting standards in response to increased risk,” Brine said. “Some don’t update. Some people stop writing new policies.”
With fewer options, some homeowners are turning to the Washington Fair Plan, which provides basic property insurance to applicants who have difficulty obtaining insurance on the standard market.
“This may not be enough to cover the full cost of the home destroyed in the fire,” Brine said.
“Consumers facing the current market may think that insurance companies are looking for ways to not insure them,” Brine said. “Insurance companies need to insure to stay in business, so they are trying to better predict the risk of loss.”
Brine pointed out that wind and hail account for nearly 98 percent of homeowners’ bills, but fire and lightning are by far the most expensive.
“Regardless of whether you want to believe in climate change as a scientific fact or what its causes are, what cannot be denied is the fact that the costs associated with storms are increasing dramatically,” Brine said. .
Some examples:
In the 1980s, there were 33 events, an average of 3.3 per year, and an average annual loss of $22 billion. 1990s – 57 events @ 5.7/year, average loss $33 billion/year. 2000s – 67 events @ 6.7/year, average loss $61 billion/year. 2010s – 131 events @ 13.1/year, average loss $99 billion/year. Over the past 5 years (2018-2023) 20/year, the average loss was $123 billion/year. In 2023 alone, 28 events were held, resulting in losses of $95 billion. Hurricanes Helen and Milton in 2024 have caused insured losses of $44 billion so far.
“We’re building more homes in dangerous locations,” Brine said. “Between 1900 and 1959, only 14 percent of new homes built in the United States faced a significant wildfire threat. Today, within two years, 55 percent of new homes are Under threat of fire.”
Washington is one of the five states with the most significant population growth over the past two years.
“A lot of people are saying they’re in an insurance crisis,” Brine said. “What we’re really facing is a climate and disaster crisis, and a population growth and building crisis. Insurance companies have no choice but to become the parcel police of last resort.”
After considering the current dynamics facing both insurers and buyers, Mr. Brine addresses the new normal in the market and the changes needed to protect homeowners and stabilize the insurance market. We looked at the measures being taken to These include legislation for consumers, advances in wildfire and home building science, and more.
Home curing rebates. Washington is the only state in the nation that prohibits insurance companies, including Firewise Communities, from offering discounts or rebates for hardening or defensible spaces in your home. Insurers support legislation to remove this barrier.
Commissioner Russ Jones said he asked the Office of the Commissioner of Insurance (OIC) what state laws prevent rebates and discounts. The response Mr Jones received indicated that discounts would be granted, but he said it would be “very difficult for an insurance company to follow all the steps involved” and left Bryne unsure if he would see any changes in the future. I asked Mr.
Bride said he has spoken with both candidates for insurance secretary.
“Both candidates are very interested in working more aggressively to strengthen housing and protect and promote defensible space,” Brine said. “I think once we have a new insurance commission, everything will go back to normal.”
Mitigation subsidy. Mitigation grants that provide financial assistance to homeowners to help them defray the costs of making their homes more fire resistant and creating defensible spaces to increase resilience at the community level. program. Investing in forest health. Insurance companies supported a bill that would invest the state $50 million over 10 years to help thin forests, prescribed burning, and provide fire prevention measures to property owners. IBHS Wildfire Safe Housing. The Insurance Institute for Business & Home Safety (IBHS) developed Wildfire Prepared Home based on years of research in fire combustion science. This certification mandates the use of fire-resistant materials and construction methods in new buildings. These standards have been adopted by state building codes throughout the West.
Brine said he recently spoke with IBHS and is currently rolling out a program in Washington, but implementation will take time.
Community resilience. Insurers are working with stakeholders from forest managers to firefighters to develop region-wide construction standards to slow the spread of wildfires and reduce loss of life and property.
Commissioner Mark Donnell said Brine is working to bring together key stakeholders such as elected officials, the OIC, insurance companies, fire chiefs and commissioners, and Brine’s group in a dialogue to improve the situation. I asked him if he thought there were any benefits.
Brine agreed, saying he is part of Oregon’s 35-member commission discussing sustainable wildfire mitigation and suppression funding.
“These things are happening on a large scale with large groups of people,” Brine said. “They have to trickle down into community-level discussions.”
Brine believes there needs to be greater understanding and communication at the local level so that homeowners understand what the market is facing and that insurance companies understand how their decisions impact homeowners. He said that there is.
Jones pointed out that if an insurance company chooses not to renew a homeowner’s policy, the company must provide a reason.
“There are cases where homes that are quite a distance from the city limits in downtown Chelan are not being updated due to wildfire risk,” Jones said. “What action will those homeowners take?”
“Right now, their options are pretty limited,” Bryne said. “They just need to go with another insurance company.”
Brine said the grievances are shared by legislators from different parts of the state.
“I wouldn’t be surprised if Washington doesn’t pass legislation requiring insurance companies to provide a little more information,” Brine said. “However, it does not change the outcome for the insured.”
Brine said policyholders can request to see the information used as the basis for non-renewal to ensure it is accurate and not outdated.
Mr. Jones asked what legislative action the Fire Chiefs/Fire Brigade Chiefs Association could take.
“What we currently have on record to support mitigation grants and to help establish standards for the construction and renovation of structures and properties,” Brine said, “and to support mitigation grants and to help establish standards for the construction and renovation of structures and properties,” Brine said, “to support mitigation grants and to help establish standards for the construction and renovation of structures and properties.” resiliency, state funding for the purpose of providing subsidies, etc.” to people based on certain needs;
“The lowest-hanging fruit for insurance industry support is risk reduction and mitigation subsidies,” Brine said. “That’s the future of living with wildfires, and we support that.”
Mike Maltais: 360-333-8483 or michael@ward.media
