Having originally said that insurance and reinsurance market losses from the Los Angeles, California wildfires were likely to “notably exceed $10 billion,” reinsurance broker Gallagher Re has now issued an updated estimate range, for an industry loss of between $20 billion and $30 billion.As we’ve been reporting, insurance industry loss estimates for the wildfires have been steadily rising in recent days, as the scale of the devastation and costs become clearer.Insured loss estimates , while some other analysts have pegged the total at the $30 billion level and higher.Late yesterday, CoreLogic became the first catastrophe risk modelling firm to issue a public loss estimate, with its analysis of residential and commercial exposures , which includes losses to the FAIR Plan.

Now, reinsurance broker Gallagher Re has issued an update to its loss assumptions for the Los Angeles, California wildfires, elevating its range.As we said, .Now, the broker has said, “The total insured loss is now estimated to fall in the range of USD20 billion to USD30 billion.

“It is possible that this may require further revision as more clarity emerges, especially if an influx of claims litigation and adjustor costs result in higher-than-expected loss adjusted expenses.This total includes expected losses incurred from the private insurance market and California’s FAIR Plan.” Gallagher Re went on to provide some clarity over how the losses may be shared between primary insurers and the reinsurance market.“The anticipated portion that that may be ceded to reinsurance is projected to reach the mid-to-high single digit billions (USD),” the broker said.

“However, this is not expected to meaningfully erode capital and should be manageable for reinsurers.“The bulk of filed insurance claims (~75%) are expected to come from residential personal lines.The rest will be unevenly split by commercial and auto.” Direct economic losses from the wildfires are put at roughly double the insured loss, according to Gallagher Re, which it notes would “represent a sizeable protection gap for such a series of wildfire events.” While the Palisades and Eaton fires have not impacted as many properties as previous costly wildfire events such as the Camp fire in 2018, Gallagher Re explained that “the 2025 fires have impacted a substantially higher volume of high-net-worth assets.” “Both fires are individually expected to rank near the top as one of the costliest US insured wildfires on record – on a nominal and loss-adjusted (2025 USD) basis,” Gallagher Re said.

Adding, “There have now been 24 individual billion-dollar insured loss wildfire events globally since 1990.” – .– .– .

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