The Aspen Acres fire tearing through southern Colorado is reinforcing a concern that has moved rapidly up property insurers’ agendas: wildfire is no longer simply a seasonal catastrophe peril, but a persistent.
As of July 9, the fire had burned 96,031 acres and was 15% contained, according to the National Interagency Fire Center. Local officials had confirmed 192 homes and four commercial buildings destroyed, while an aerial-imagery analysis identified as many as 780 structures, including garages, barns and sheds.
Philip Wray (pictured), head of property at MSIG USA, said the expanding concentration of property in fire-prone areas and the difficulty of completing recovery after major events have made wildfire at least as concerning as hurricanes.
“I’m almost more concerned about wildfire,” Wray said. “If you look at the California wildfires in January 2025, a lot of the issues emerging from those fires still remain unresolved.”
Wildfire's threat to insurers does not end when the flames are contained; it continues through years of claims disputes and displaced communities. One year after the Palisades and Eaton fires destroyed about 13,000 homes and other residential properties, fewer than a dozen homes had been rebuilt and roughly 900 were under construction.
Aon estimated that the Palisades and Eaton fires generated $41 billion in insured losses, making them the costliest wildfires on record globally. California’s Department of Insurance said 41,800 claims had been filed and $23.7 billion paid as of March 3, 2026.
For Wray, the risk is also being amplified by development patterns. Hurricanes can produce enormous losses in a single landfall, but wildfire can repeatedly threaten more dispersed communities and generate complex smoke and debris claims.
“We now have a lot of value built in places where we probably didn’t have it two decades ago,” he said. “Maybe a wildfire occurred 20 years ago and didn’t touch anything. Now there is suddenly a lot of value in its path because people have built out into those wildland-urban interface areas.”
The concern comes as commercial property pricing softens. Wray said more capacity is available in the US market, while clients are pressing insurers for broader coverages and higher limits, increasing the importance of disciplined catastrophe underwriting.
For MSIG USA, navigating this environment means being selective in where it grows. The carrier relies heavily on modelling and account-level analysis, while also asking underwriters to examine vegetation, surrounding terrain and mitigation measures.
Wray said tools can now assess factors such as whether vegetation is native to an area and the fire load it could present. “Our ability to underwrite that risk is improving greatly,” he said. “Wildfire is one bucket where I feel pretty confident that, as we move forward, we have the tools.”
Technology, however, does not replace underwriter judgement. Aerial imagery, mapping platforms and property-level data must be combined with assessments of defensible space, nearby vegetation, emergency access and the measures a client has taken to reduce losses.
This approach becomes more important in a buyer’s market. As rates fall and policyholders seek more favourable terms, insurers face pressure to retain business without allowing pricing or coverage to move beyond what the underlying risk justifies.
At the same time, better models are not enough to close the protection gap. Even where insurance exists, rebuilding inflation and demand surge — the spike in labour and materials costs following a major loss — can leave insured limits well short of reconstruction costs. The result can be a gap between what is paid during the claim and what it ultimately costs to rebuild.
“You really see an issue for people who don’t have insurance, that they’ve lost everything,” Wray said. “That is a big issue.”
