L.A. on fire

Insurance problems exacerbate the situation

Even the famous Sunset Boulevard was not spared.

(Bild: ASSOCIATED PRESS)

Ten lives have already been lost in the blaze in the Los Angeles area and around 10,000 buildings have been destroyed or damaged. Insurance problems are now exacerbating the situation.

These are the most devastating fires in California's history, said the dismayed US President Joe Biden, while California's insurance commissioner Ricardo Lara called for swift financial support for those affected: "My main concern now is that the survivors of the wildfires receive the insurance benefits to which they are entitled as quickly as possible."

Providers withdrew protection!
According to US media reports, some major providers had already restricted insurance cover in the now affected area last spring due to the high risk of wildfires and withdrew it completely for certain new buildings. This could leave some homeowners without adequate insurance cover.

(Bild: APA/AFP/Frederic J. Brown)

Although the US federal government has promised financial aid, these measures do not solve the fundamental problem. The central question remains: Who will bear the costs of the growing damage caused by extreme weather events in the future - the private sector, the government or ultimately those affected themselves?

(Bild: ASSOCIATED PRESS)

Increasing risks from floods, storms and fires
Lara emphasized that the current challenges require a modernization of the insurance system and targeted disaster prevention measures. He also called on insurers to maintain their cover in risk areas - especially if they use catastrophe-related models to calculate their premiums.

The construction of many homes in the US is an important factor here: they are often made of wood, which not only causes them to burn down rapidly, but can also fuel the fires. This structural vulnerability makes comprehensive insurance cover all the more important. Meanwhile, the climate crisis is exacerbating the challenges for insurers across the country. Increasing risks from floods, storms and fires pose growing difficulties for the industry to offer viable policies and raise fundamental questions about protection against natural disasters.