Unprecedented costs from wildfires in the American West have spurred a need for wildfire risk reduction in at-risk areas. Communities and homeowners need tools to understand the costs and benefits of various means of wildfire risk mitigation. Insurance rates must be updated to reflect resulting aggregate and relative reductions in risk for properties and communities. This paper illustrates the following use cases for catastrophe models to measure the effects of wildfire mitigation on homeowners and communities:
- Case study 1: Calculating individual property mitigation credits
- Case study 2: Credits for community mitigation
- Case study 3: Measuring results at the community level
This article was published by the Casualty Actuarial Society.