Tragically, 16 lives have been lost, and over 10,000 homes and structures have been reduced to ashes.
The Palisade and Eaton fires, two of the largest, have ravaged more than 30,000 acres.
AccuWeather has provided an initial estimate, suggesting that the damage and economic losses may range between $135 billion and $150 billion.
Such substantial financial repercussions could affect Americans who reside far from California or the fires themselves.
AccuWeather’s estimate takes into account various factors, including damage to homes, businesses, infrastructure, and vehicles, as well as immediate and long-term healthcare costs, lost wages, and supply chain disruptions.
Jonathan Porter, chief meteorologist at the private firm, stated: “This will be the costliest wildfire in California modern history and also very likely the costliest wildfire in U.S. modern history, because of the fires occurring in the densely populated areas around Los Angeles with some of the highest-valued real estate in the country.”
Porter further explained, “To put this into perspective, the total damage and economic loss from this wildfire disaster could reach nearly 4% of the annual GDP of the state of California.
“We’re in the very early stages of this disaster.”
JPMorgan Chase estimates that insurance will cover only $20 billion of the projected losses, leaving $115 billion worth of costs uncovered.
This gap is expected to be compensated through federal aid, personal savings, and charitable donations.
The ripple effects of rising insurance premiums, reduced availability of coverage in high-risk areas, and increased federal disaster spending will be felt by taxpayers and policyholders nationwide.
On January 10, the insurance broker Aon PLC also indicated that the L.A. County wildfires could potentially become the most expensive in U.S. history, though they did not provide a specific cost estimate.
Moody’s, a financial service company, issued a similar alert, citing the fires’ devastation in densely populated areas with high-end properties as a key factor.
“The scale and intensity of the blazes, combined with their geographic footprint, suggest a staggering price tag, both in terms of the human cost and the economic toll,” Moody’s analysts commented.