Munich Re expects €1.2 billion claims from Los Angeles wildfires

Munich Re has estimated that the January 2025 wildfires in Los Angeles could result in claims of approximately €1.2 billion ($1.3 billion), marking the costliest wildfire event in insurance history. The wildfires, which killed over two dozen people and destroyed or damaged more than 16,000 structures, have generated estimates of total economic losses between $250 billion and $275 billion. Despite these substantial losses, Munich Re reported a net result of €5.7 billion for 2024, surpassing its profit target for the fourth consecutive year. The company also noted a slight decline in fourth-quarter profits, down to €979 million from €1 billion the previous year. While the claims from the wildfires contribute to an overall increase in losses from natural catastrophes, Munich Re remains optimistic about future profit growth, projecting a net profit of €6 billion for 2025. The firm emphasized its preparedness to manage such risks, reflecting a strategic reduction of exposure to significant losses over the past five years.