California wildfire costs may soar past last year’s record high

SAN FRANCISCO — Insurance claims and cleanup costs associated with California wildfires last month are expected to exceed the record-breaking amounts paid out last year after blazes ripped through northern California wine country.

The insurance industry is bracing for payouts exceeding last year’s record $11.8 billion payments to northern California fire victims.

California Insurance Commissioner Dave Jones says he will release preliminary claims data Wednesday for the three wildfires last month that destroyed 19,000 homes and businesses.

Jones has warned that increasing risk from wildfires in California could prompt insurers to raise premiums or decline to sell policies to homes in high-risk areas.

State and federal authorities estimated Tuesday that it will cost at least $3 billion to clear debris.

Most of the work will occur in northern California, where the Camp Fire destroyed the city of Paradise and killed at least 86 people, making it the nation’s deadliest wildfire in a century. Three people remain on a list of missing.

The disaster relief officials said the cleanup costs will far surpass the record cleanup expense of $1.3 billion the U.S. Army Corp of Engineers spent on debris removal in northern California in 2017.

California Office of Emergency Services director Mark Ghilarducci said the state will manage cleanup contracts this time. Last year, hundreds of northern California homeowners complained that contractors paid by the ton hauled away too much dirt and damaged unbroken driveways, sidewalks and pipes. The state OES spent millions repairing that damage.

Cleanup is expected to begin in January and take about a year to complete, Ghilarducci said. State and federal officials are currently removing hazardous household materials from the damaged properties.