Impact of Los Angeles Fire: Insurance Company Stocks Plunge
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| Fire in Los Angeles (Doc. Ist) |
Printable.biz.id – On Friday (January 10), insurance company stocks in Los Angeles saw a sharp decline due to recent wildfires in the area. Analysts predict that insured losses could reach up to $20 billion.
According to Reuters on Sunday (January 12, 2025), analysts are currently evaluating the financial impact of this disaster. J.P. Morgan has doubled its estimate of insured losses to over $20 billion.
Meanwhile, Wells Fargo projected similar losses and stated that the total economic impact of the disaster could exceed $60 billion. These losses are staggering, considering the area is home to Hollywood's elite.
"Although major U.S. property insurance companies are financially stable, the property insurance market in California has become increasingly challenging, prompting many insurers to reconsider their offerings, including withdrawing from the market," Morningstar DBRS reported.
Additionally, Raymond James estimated insured losses to range between $11 billion and $17.5 billion, calling this event the most expensive wildfire in U.S. history.
Morningstar DBRS analysts initially estimated insured losses at over $8 billion but noted that the exact financial toll of the wildfires remains uncertain.
"Major U.S. insurance companies have significantly reduced their exposure in California due to the costly and unpredictable risks of wildfires, coupled with strict price controls in the state," Jefferies analysts wrote.
