California Wildfires 2025: Insurance Stocks Plunge Amid $135-$150 Billion Damage Estimates
Insurance stocks sharply decline as California wildfires cause unprecedented economic losses estimated between $135 billion and $150 billion, potentially impacting nearly 4% of the state's GDP.
Bill McColl brings over 25 years of expertise as a senior producer and journalist across TV, radio, and digital platforms, leading teams in delivering impactful news coverage on major events.
Essential Insights
- Shares of insurance companies dropped significantly due to California's devastating wildfires, with damage and economic losses now estimated between $135 billion and $150 billion.
- AccuWeather warns that the financial impact could escalate further as fires continue to spread.
- The economic damage may account for nearly 4% of California’s annual GDP, highlighting the wildfire's severe impact.
On Friday, insurance sector stocks experienced notable declines amidst the ongoing wildfires in Southern California, which have inflicted billions in damages.
Travelers Companies (TRV) shares fell nearly 4%, leading losses within the Dow Jones Industrial Average, while Allstate (ALL) and Chubb Limited (CB) dropped 5% and 4%, respectively. The SPDR S&P Insurance ETF (KIE) also decreased by 2.5%.
AccuWeather’s latest preliminary assessment estimates the wildfires, ignited on Tuesday, have caused total damage and economic losses ranging from $135 billion to $150 billion. The firm cautions that these figures could rise substantially as the situation evolves.
Jonathan Porter, Chief Meteorologist at AccuWeather, described the aftermath as “heartbreaking” and the economic consequences as “staggering,” emphasizing that the financial toll might approach 4% of California’s yearly GDP.
State Farm, the largest property insurer in California and privately held, has advised customers to submit claims when safe. However, many policyholders may face challenges, as the company did not renew policies for approximately 30,000 homeowners and renters, along with 42,000 commercial apartments last year.
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