CoreLogic announced a preliminary range of insured losses for the Eaton and Palisades Fires in Los Angeles of $35 billion to $45 billion, but there are a lot of factors that could change the numbers.
“We don’t know,” Tom Larsen, senior director of insurance solutions, repeated multiple times during a Jan. 16 webinar, referring to uncertainties about factors like smoke damage beyond any historical reference point, the prevalence of minimally insured and uninsured homes, and even potential mudslides that may occur years down the road.
Before reviewing these in some detail, Larsen explained that CoreLogic produces its estimates from the ground up, starting at the parcel level—looking at the building characteristics of properties in the impacted areas, such as square footage and age, and eventually using reconstruction valuation models to estimate costs.
The next step involves looking at aerial imagery, further annotating the extent of damage to properties, and also relying on the judgment of CoreLogic experts “on the ground, who are looking at claims data, looking at what are the [cost] patterns f