Wildfire Risk and Insurance: A Community-Scale Approach to Mitigation

As the risk of wildfires continues to escalate, homeowners are turning to fire smarting measures to reduce their risk. However, insurance companies are unlikely to reward individual efforts with lower premiums, as the safety of a house often depends on the actions of neighbors as well. Two insurance companies, BCAA and The Cooperators, are experimenting with premium deductions for homeowners who complete fire smart assessments and live in certified fire smart communities.

Key Takeaways:

• BCAA will give homeowners a $100 discount on their insurance premium if they complete an assessment certified by FireSmart BC, and an additional 5% rebate per year if they follow the recommendations of the assessment specialist.
• The Cooperators offers a $90 premium deduction for a fire smart assessment and/or residence in a certified fire smart community, as defined by FireSmart Canada.
• Michael Currie, western Canada director for the Fire Underwriters Survey, notes that insurance companies are starting to think about the new wildfire reality and developing classification systems to rate a community's vulnerability to wildfire.
• The Insurance Bureau of Canada reports that insured damage in 2024 caused by extreme weather events exceeded $8 billion nationwide, surpassing the previous record of $6 billion in 2016.
• The Fire Underwriters Survey is developing a new wildfire grading index to help insurance companies assess community-scale risk and encourage mitigation efforts.
• FireSmart Canada's FireSmart Communities program allows communities to be certified if they carry out certain mitigation efforts, but the requirements are considered "minimalistic" by Currie.

Statistics:

• Insured damage in 2024 caused by extreme weather events exceeded $8 billion nationwide, a record that surpasses the previous $6 billion in 2016.
• The 2024 total is nearly triple the insured losses from 2023 and 12 times the average over 2001-2010.
• The Fire Underwriters Survey's data was mostly about risk and emergency response to fires that start in and around urban buildings, and insurance policies did not take into account the new types of events like the Fort McMurray wildfire.

Sources:

• "Insured Damage in 2024 Exceeds $8 Billion After Extreme Weather Events" by the Insurance Bureau of Canada (2025)
• "Wildland Urban Interface Guide for Canada" by the National Research Council
• "BC Wildfire Season Brings Understand Economic Consequences" by the Nelson Star
• "FireSmart Communities" by FireSmart Canada
• "FireSmart BC" by FireSmart BC