How Virginia Wildfires Could Impact Home Insurance Rates

Gov. Glenn Youngkin declared a state of emergency in Virginia due to multiple wildfires in the state, stoked by dry conditions and dry winds. The month-long state of emergency went into effect on Monday, Nov. 6, 2023, days after two fires — the Quaker Run Fire in Madison County and the Tuggles Gap Fire in Patrick County — broke containment lines.

Virginia homeowners may see higher home insurance rates down the road because of the fires. Homeowners in “very high” risk areas pay nearly 2.5 times as much for home insurance than those in “very low” risk areas, according to Insurify’s analysis of Quadrant and FEMA data.

Scope of the fires

The Quaker Run Fire has burned approximately 2,800 acres, including 670 acres in Shenandoah National Park. The Tuggles Gap Fire has burned 850 acres and is 35% contained. Fire bans are currently in effect in Shenandoah National Park and Patrick County.

The state of emergency order mobilizes the Virginia National Guard, which will help the Virginia Department of Forestry (DOF), the Virginia Department of Emergency Management, and other agencies involved in containment and relief efforts.

Virgnia’s wildfire season runs through Nov. 30, as fall weather conditions create favorable conditions for fires to spread.

Virginia wildfires’ impact on homeowners

Each year, more than 60 homes and other structures in the state are damaged by wildfires, according to the Virginia DOF.

The Federal Emergency Management Agency (FEMA) assigns risk ratings to areas based on the probability and severity of natural disasters. Most inland counties in Virginia are at “relatively low” or “very low” risk. However, some of Virginia’s most populous counties, including Virginia Beach City, Chesterfield, and Chesapeake City, are at “relatively moderate” risk.

Climate risks can affect the price of homeowners insurance. Homeowners insurance in “very low” risk areas costs an average of $1,387 annually, according to Insurify’s analysis of Quadrant and FEMA data. In “very high” risk areas, homeowners pay an average of $3,379 annually — nearly 2.5 times as much as the “very low” risk rate.

What’s next

Climate change is increasingly affecting homeowners insurance companies and policyholders. Some areas are unprofitable for insurers due to expensive claims from wildfires, hurricanes, hailstorms, and other severe weather events. In response, insurance companies have pulled back coverage in some states, including California, Florida, and Louisiana.

Average annual rainfall in Virginia has increased by 4 to 6 inches since 1950, and Richmond’s average annual temperature has risen 2.6°F since 1970, according to the George Mason University Virginia Climate Center. As the severity and frequency of climate catastrophes increase in Virginia, homeowners in the state may soon face fewer insurance options and higher rates.