As of August 2025, nearly four million acres have already been burned by wildfires, and there have been a total of 44,470 known wildfires this year to date. While those numbers are below last year’s total, the damage caused this year in California alone already exceeds previous years. Wildfires are becoming increasingly problematic, and so too is insuring properties against this threat. One-third of the U.S. population lives in counties with high wildfire risk, but California has seen some of the most prominent insurance market convulsions around fire risk and home insurance. Carriers are limiting coverage due to this threat in sections of other states as well, like in rural Oklahoma. With wildfires becoming increasingly dangerous to homeowners and coverage becoming more complicated to find, it’s vital to understand the fire risks to your home and the insurance options available.
How fire risk affects homeowners insurance costs
According to the National Interagency Fire Center (NIFC), 64,897 wildfires affected over 8.9 million acres in the U.S. in 2024. These numbers, together, are the highest since 2017, when 71,499 fires affected 10 million acres. In 2025, the LA wildfires alone are estimated to have caused between $28 to $53 billion in property damage. Areas prone to this type of wildfire risk create a challenging insurance landscape.
When determining home insurance rates, most insurance companies will review the home’s location and the surrounding area’s features. Neighborhoods close to wildfire zones or in wildland urban interface locations are more at risk of damage or total loss. The higher the disaster risk, the higher the home insurance premium typically is, often making homeowners insurance in fire-prone areas relatively expensive. As rising temperatures and more frequent droughts spread across the U.S., areas that were once unaffected by wildfires are becoming at risk for this type of natural disaster.
