Amid Camp Fire, Carriers Can Speed Recovery Efforts with Property-Level Data

Posted on Nov 27 2018
Type Blog

Camp Fire claimed at least 153,000 acres and more than 14,000 structures in Butte County. According to BuildFax data, maintenance activity – construction performed on properties – in the area increased 8.57 percent year to date compared to January through October 2017. This suggests carriers may not have accurate assessments of the wildfire’s true damage on their books.

Camp Fire, officially California’s largest and deadliest fire, comes on the heels of an already active 2017 fire season. A primary difference between Camp and previous wildfires, however, is that Camp Fire impacted populated areas and surpassed all previous records for structure damage. As residents of Camp Fire-impacted towns start to rebuild, it’s important that carriers are armed with the right information to pay out claims as fast as possible and with the most up-to-date property-level information available.

California Wildfire Costs are Increasing

Residential maintenance costs related to fires in California have been steadily increasing over the past five years, but 2018 saw the largest jump with costs rising 93.80 percent year over year as of October 2018. This increase is not surprising after 2017’s active wildfire season, impacting large swaths of the state. Before Camp Fire, in fact, a combination of the Tubbs and Atlas Fires in Napa, Thomas Fire in Santa Barbara, and Redwood Valley Complex Fire in Mendocino made up the costliest fire season on record. We anticipate an even larger jump in wildfire costs following Camp Fire because it impacted populated areas.

The collective impact of 2017 wildfires by a measure of structures damaged does not come close to Camp Fire, indicating an uphill climb for carriers looking to pay out claims to insureds. The total cost to the state, insurers and homeowners is estimated to top $19 billion. What’s more, carriers may not have an accurate estimate of a structure’s value given the level of maintenance and remodeling activity in Butte County over the past ten months. As a result, carriers are likely to face an arduous claims payout process.

Rise in Butte County Construction Activity Drives Complex Claims Payouts for Carriers

Butte County saw an 8.57 percent year-to-date increase in residential maintenance activity over January to October 2017. Meanwhile, remodels – a subset of maintenance that includes additions, renovations, and alterations – rose 7.83 percent in that same time frame. Remodels tend to be larger scale projects, likely leading to premium-impacting changes on a structure.

These increases demonstrate a substantial level of construction activity that may be unaccounted for when it comes time for carriers to pay out claims. The claims department, a primarily customer-facing entity, will streamline their processes considerably if they provide accurate claims payouts early on.

Property-Level Insights Enable Carriers to Handle Wildfire Claims at Scale

Carriers are seeing an influx of claims come through as insureds look to rebuild their lives after the devastating Camp Fire claimed a record number of structures in Butte County. In instances where property changes haven’t been captured, BuildFax provides carriers with timely property history and condition insights, which takes into account premium-impacting property changes, to pay insureds quickly. It’s also increasingly important to understand the condition of roofs in wildfire-prone areas as construction trends change in reaction to shifts in weather patterns. In just the first month after implementing BuildFax data, one carrier saved 30 percent additional research time. Homeowners in turn can start the rebuilding process as soon as possible.

BuildFax will continue to monitor recovery efforts in Butte County and our thoughts are with everyone impacted by the fires. For carriers, responding to claims submissions as soon as possible is crucial to delivering a quality experience to insureds. Arm your departments with the tools they need to efficiently manage incoming wildfire claims.

If you’re tasked with claims verification, contact BuildFax today. Trusted by the largest insurance carriers in the world, BuildFax empowers customers to stay on the pulse of property changes with more than 250 million residential and commercial construction projects, ranging from roof repairs to newly built structures.

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