KCC releases wildfire model that accounts for climate change
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Karen Clark & Co. on Tuesday released a high-resolution U.S. wildfire model that accounts for the impacts of climate change and provides a view of future loss potential.
The model shows insurers could face a loss in excess of $30 billion from an extreme fire in California, and they should be prepared for losses exceeding $10 billion with a significant probability based on today’s exposures and climate conditions, KCC CEO Karen Clark said.
The model includes exceedance probability curves, probable maximum losses and average annual losses down to the location level and can be used to develop underwriting and pricing strategies, the Boston-based catastrophe modeler said in a statement.
Version 1.0 accounts for various atmospheric variables including vapor pressure deficit, which is the capacity of an airmass to hold moisture beyond what is available in the atmospheric environment. The model also considers high-resolution fuels data, topography, wind speeds, road density, suppression activities and other factors that influence the rate and direction of fire spread, KCC said.
Several secondary building characteristics and mitigation features are also incorporated.
Insurers that license the model will also have access to KCC’s live events process for monitoring fires as they propagate and spread, KCC said.
The model comes with nine climate change scenarios reflecting wildfire loss potential in 2025, 2030 and 2050, as well as data from the Intergovernmental Panel on Climate Change.
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