PORTLAND, OR (KPTV) - A London-based firm that is more than 300 years old might pitch in to help the state cover the cost of catastrophic wildfires.
Oregon has been using Lloyd's of London for 46 years, purchasing insurance policies that pay for firefighting costs during massive wildfires.
Doug Grafe, the chief of fire protection for the Oregon Department of Forestry, says the state carries a $25 million policy with a deductible and premium. The plan is very unique, and according to Grafe, is "the only kind in the world for catastrophic wildfire suppression".
The premium and deductibles that Oregon pays have skyrocketed in recent years as the state has been overwhelmed with devastating wildfires. Both Oregon and private timberland owners share the cost of the $3.75 million premium, which is up nearly double from last year. The deductible rose from $20 million to $50 million, according to officials.
Grafe says the insurance policy has always paid off. The state has paid about $75 million in premiums so far and has received $99 million in claims over the lifespan of the coverage.
Grafe says as Oregon experiences more catastrophic wildfires, there's an increased risk that the Lloyd's of London will drop the coverage all together.
"That’s always a concern, and we meet with London and the underwriters and we state our case as to why we’re different and we’ve been a good risk and that’s what’s maintained our relationship for so many years,” Grafe said.
Grafe says the gross costs of the fires are well over $100 million, but FEMA will pay for a significant portion of those costs. Grafe says the late fire season this year did help to reduce firefighting costs, as heavy rain aided in the efforts to extinguish the flames.
Oregon leaders say they're still not sure whether the state will meet that $50 million threshold for the deductible. So far, they've calculated costs that FEMA will not cover as about $41.3 million, so they say once all the dust settles, it will be close.
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