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Old 11-05-2018, 03:28 PM
jerrytuttle jerrytuttle is offline
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Default Wildfire reinsurance

Quick question: How are wildfires generally reinsured? Is a property cat treaty generally named peril?
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Old 11-05-2018, 03:31 PM
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DeepPurple DeepPurple is offline
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Quote:
Originally Posted by jerrytuttle View Post
Quick question: How are wildfires generally reinsured? Is a property cat treaty generally named peril?
Wildfires get PCS numbers Jerry. Most cat treaties apply on a per occurrence basis. I cannot speak to all cat treaties but they generally are NOT named perils and loosely refer to something like "Disaster, accident, losses, or event"

On the other hand, since many fires are traced back to utility companies, those utility companies' liability policies may come into play. Think about the potential umbrella liability.

Furthermore, the Cal Insurance Commissioner proactively mandated that mudslide losses (that otherwise might have been excluded) were a consequence of wildfires (proximate cause) and therefore covered by policies {re}insuring fire.
Here's a link to CAL Dept of Insur memo: http://www.insurance.ca.gov/0400-new...use-NOTICE.pdf



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Last edited by DeepPurple; 11-05-2018 at 03:47 PM..
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Old 11-06-2018, 01:59 PM
r8ingStuff r8ingStuff is offline
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I agree with the above, and will also add...

Although most reinsurance agreements are not named peril, you might find some wording in the "Occurrence" article specific to wildfires. Specifically, some reinsurers will include an "hours clause" that limits the amount of time that one wildfire can be considered one occurrence (ex. 36 hours), until it is broken into two occurrences (subject to another retention / reinstatement premium).

Disclosure - I've been away from property cat reinsurance for a few years, but I don't suspect this has changed too much.
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