FILE - In this Nov. 11, 2018 file photo, a home burned down by a wildfire sits on a hilltop overlooking the Pacific Ocean in Malibu, Calif. Authorities estimate it will cost at least $3 billion to clear debris of 19,000 homes destroyed by California wildfires last month. State and federal disaster relief officials said Tuesday, Jan. 11, that private contractors will most likely begin removing debris in January from Butte, Ventura and Los Angeles counties and costs are likely to surpass initial estimates. (AP Photo/Jae C. Hong, File)

California wildfires costs may soar past last year's records

December 12, 2018 - 12:56 pm

SAN FRANCISCO (AP) — Insurance claims and cleanup costs associated with California wildfires last month are expected to exceed the record-breaking amounts paid out last year after blazes ripped through Northern California wine country.

The insurance industry is bracing for payouts exceeding last year's record $11.8 billion payments to Northern California fire victims.

California Insurance Commissioner Dave Jones says he will release preliminary claims data Wednesday for the three wildfires last month that destroyed 19,000 homes and businesses.

Jones has warned that increasing risk from wildfires in California could prompt insurers to raise premiums or decline to sell policies entirely to homes in high-risk areas.

State and federal authorities estimated Tuesday that it will cost at least $3 billion to clear debris.

Most of the work will occur in Northern California, where the Camp Fire destroyed the city of Paradise and killed at least 86 people, making it the nation's deadliest wildfire in a century. Three people remain on a list of missing.

The disaster relief officials said the cleanup costs will far surpass the record cleanup expense of $1.3 billion the U.S. Army Corp of Engineers spent on debris removal in Northern California in 2017.

California Office of Emergency Services Director Mark Ghilarducci said the state will manage cleanup contracts this time. Last year, hundreds of Northern California homeowners complained that contractors paid by the ton hauled away too much dirt and damaged unbroken driveways, sidewalks and pipes. The state OES spent millions repairing that damage.

Ghilarducci said the state OES will hire auditors and monitors to watch over the debris removal in hopes of cutting down on the number of over-eager contractors.

"We learned a great number of things," last year, Ghilarducci said.

He said the U.S. Corps of Engineers was asked to lead the effort last year because state resources were stretched thin after responding to more than a dozen wildfires. This year, he said state officials can manage the cleanup and costs will be shared among state, federal and local authorities.

Cleanup is expected to begin in January and take about a year to complete, Ghilarducci said. State and federal officials are currently removing hazardous household materials from the damaged properties.

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This story corrects the spelling of Insurance Commissioner Dave Jones.

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