With the Morgan Rocky Canyon Fire mostly behind us, I thought it would be a good time to address one of the most expected insurance coverages: fire. Fire protection is the foundational risk that insurance was designed to protect against. Let’s look at two causes of fire loss, see how they have changed over the last 100 years, and consider how we might grade our progress.
Wildfires
The greatest advancement in fire protection we have seen in the last 100 years is our ability to contain and extinguish wildfires. The Great Fires of 1898 and 1910 were each estimated to have burned more than 3 million acres. With the exception of the Texas Smokehouse Creek Fire, which burned more than 1 million acres in 2024, these massive wildfires have steadily declined in total acres burned.
Fatalities from wildfires follow a similar trend. The five deadliest wildfires occurred more than 100 years ago, with the exception of the Lahaina, Hawaii, fire in 2023, which killed 101 people. Financial losses, however, follow the opposite trend, with 20 of the costliest wildfire losses occurring in the last 30 years. The most staggering loss to date was the California Eaton and Palisades fires, estimated at $65 billion.
This is not especially surprising, given the rising cost of homes and continued urban development into wilderness areas. If our success in taming wildfires were judged by dollars alone, I’m afraid the grade would be an F.
House Fires
There is not significant data on home fires dating back 100 years, but house-fire losses have declined by more than 40% since the late 1970s and early 1980s. This is largely due to advancements in flame-resistant building materials and faster response times from local fire departments.
House fires still account for more than 80% of fire-related deaths. The major causes are cooking and heating. Distracted cooking and unattended stovetops account for more than 45% of house fires. Smoke detectors and automatic fire-alarm dialers have helped reduce house-fire losses and made homeowners more aware of the dangers.
After all our efforts to reduce losses from house fires, I couldn’t give us a grade higher than a C.
Insurance on the Front Lines
Fire insurance has come a long way from simply paying claims after a loss. For decades, the insurance industry has lobbied for uniform electrical and building codes, better infrastructure for fire engines, and improved water-supply sources.
The modern approach relies more on risk management, predictive models, and maintenance inspections than on simple historical loss data. Coverage has improved as well. Extended replacement cost, loss of use, and debris removal have become standard endorsements.
Providing insurance coverage that meets all public demands remains an elusive, moving target. For the insurance industry’s adaptability, I would give it a B.
Between 75% and 90% of all property-fire losses are preventable. If you are proactive and attentive in protecting your property—and you talk with your insurance agent regularly—you can grade yourself with an A.
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