By: Luke Jones, Published on December 19, 2017 01:01 PM, Last Update on December 19, 2017 10:02 AM
Record wildfires in the United States and Canada this year were caused by climate change and it may be too late to stop it, forcing insurance companies to adapt. That’s the view Karen Gavan, the former CEO of Waterloo, Ont.-based Economical Insurance, who stepped down last year.
“Literally California has been burning all fall,” said Gavan in an interview with Canadian Underwriter on Monday. Since leaving Economical, she has been serving on the board of Swiss Re America Holding Corporation.
Gavan also said British Columbia has gone through one of the Also, this year has been one of the “worst wildfire seasons.”
The Insurance Bureau of Canada (IBC) reported this year (based on CatIQ data) said that B.C. wildfires in Williams Lake and Elephant Hill caused over $127 million in insured damages. The record wildfires in B.C. may not have cost the industry as much as 2016’s Fort McMurray event that cost insurers over $3.5 billion.
In northern California, wildfires raged and claimed thousands of properties. Burning from October to early December. The state’s insurance department said the October fires cost US$9.4 million in insured losses. The Thomas fire that started two weeks ago is still burning, but has been 45% contained.
Gavan is clear that the fires in California and B.C. are “part of climate change,” and we will see more events like flooding and storms.
“I think societies need to adapt to the changes and prepare for the impacts of climate change,” she said. “I don’t think we are going to reverse it or undo it. I think we have to adapt.”
Gavan was leading Economical Insurance when the company decided to go private following the federal government’s 2015 decision to let P&C providers demutualize.