Wildfires continued to burn Monday in Alberta, but began moving away from hard-hit Fort McMurray as rating agencies said what looks to be Canada's worst catastrophe will hit insurer earnings but still not be a major capital event.

Fire officials reported said that cooler weather had slowed the wildfire's growth to begin allowing inspection of Fort McMurray, whose residents were evacuated last week. About 100,000 people reportedly were evacuated from the area. Fire had burned an estimated 395,000 acres as of Sunday, officials said.

Steve Bowen, Chicago-based director of Impact Forecasting, Aon Benfield's catastrophe modeling development team, said Monday that local officials were reporting that 20% of Fort McMurray, one of the province's largest metropolitan areas, had been destroyed

“That (20% figure) certainly highlights the enormity and severity of the event. However, it also will hopefully help bring clarity to the situation given some erroneous reports floating around that the entire city will need to be rebuilt,” Mr. Bowen said in an email. “Simply put, it's a major event and one that may end up rewriting the record book as the costliest disaster in Canada.”

Fort McMurray is home to Canada's oil sands industry and, while the fire did not directly hit the oil sands area, workers at the major oil companies were evacuated.

In a brief released late Friday, rating agency A.M. Best Co. Inc. said “the operational impact of this event will be vast, as agents and adjusters have been deployed in anticipation of a surge in claims activity.”

“This event has the potential to be the costliest catastrophe to ever impact the Canadian property/casualty market,” Best said in the report. While the losses will be substantial, Best said many of Alberta's top homeowners' and auto writers have diverse programs, strong risk-adjusted capitalization, comprehensive reinsurance programs and solid risk management capabilities.

“While it is too early to determine any ratings impact, it is expected that these companies will be able to absorb the losses without a material impact to their risk-adjusted capital positions,” Best said.

New York-based Fitch Ratings Inc. also said the fires are likely to be the costliest natural catastrophe in Canadian history.

While Moody's Investor Service also said the wildfires look to set the record for worst catastrophe losses in Canada, “the catastrophe will not be a major capital or credit event for the Canadian (property/casualty) industry,” even though it will hurt insurers' second-quarter and third-quarter earnings.