Shares of insurance companies tumbled on Friday as the deadly wildfires in Southern California that are still burning have already caused billions of dollars in damage.
The Travelers Companies (TRV) was down nearly 4% in recent trading, leading decliners in the Dow Jones Industrial Average, while Allstate (ALL) and Chubb Limited (CB) fell 5% and 4%, respectively. The SPDR S&P Insurance ETF (KIE) was down 2.5%.
The latest preliminary estimate from weather site AccuWeather is that the blazes, which broke out on Tuesday, have created total damage and economic loss of between $135 billion and $150 billion. AccuWeather noted that as the fires continue to spread, that number could go up, possibly substantially.
AccuWeather's Chief Meteorologist Jonathan Porter said “the devastation left behind is heartbreaking and the economic toll is staggering,” adding that the financial cost might reach nearly 4% of California’s annual gross domestic product (GDP).
Privately held State Farm, the largest property insurance provider in the state, has told customers to file claims when safe to do so. However, many likely won’t be able to because last year the insurer didn’t renew policies for some 30,000 homeowners and renters, and 42,000 commercial apartments.
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