Research Note
Wildfire Catastrophe Model Record
A catastrophe model simulates many plausible events, estimates damage to an exposure portfolio, applies policy and reinsurance terms, and produces a distribution of finan
In this article
Wildfire Catastrophe Model Record
What the model computes
A catastrophe model simulates many plausible events, estimates damage to an exposure portfolio, applies policy and reinsurance terms, and produces a distribution of financial loss. It does not predict the exact date, ignition, path, or loss of the next fire.
The NAIC property catastrophe-model record defines the four core components and outputs:
https://content.naic.org/insurance-topics/catastrophe-models-property
| Component | Function |
|---|---|
| Hazard | Event catalog, location, intensity, path, frequency, and footprint |
| Vulnerability | Damage conditional on intensity and construction characteristics |
| Exposure | Geocoded properties, occupancy, values, and data quality |
| Financial | Policy and reinsurance terms applied to damage |
Outputs can include average annual loss, occurrence or aggregate exceedance probability curves, and return-period loss estimates.
Uncertainty and governance
Model output depends on event sets, data, assumptions, calibration, vulnerability functions, geocoding, valuations, policy terms, demand surge, version, and user choices.
Two models or versions can disagree without either being a point forecast. Review requires intended use, validation, sensitivity, limitations, change control, and qualified interpretation.
California status
California finalized catastrophe-model regulations in December 2024 and completed review of the first wildfire model in July 2025:
https://www.insurance.ca.gov/0400-news/0100-press-releases/2025/release052-2025.cfm
The public wildfire model is a separate initiative authorized in 2025. As of July 28, 2026, the Department had requested university expertise and anticipated issuing a development grant in October 2026:
https://www.insurance.ca.gov/01-consumers/180-climate-change/public-wildfire-model.cfm
Regulatory review or permitted use does not guarantee accuracy for every portfolio, decision, rate, property, or event.
Sources
Follow the evidence.
- content.naic.org: catastrophe models propertycontent.naic.org
- content.naic.org: reinsurancecontent.naic.org
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