Wildfires Lead to Record Economic Losses in 2025

In 2025, severe wildfires caused unprecedented economic damage, despite a relatively small total burned area. A report published recently highlights this issue.

Wildfires in Los Angeles and other international locations, like South Korea and Spain, resulted in a global loss of at least $54 billion. This represents the highest insured losses on record.

These figures exclude indirect losses, such as missed workdays, business disruptions, and increased strain on healthcare services. The report suggests that the total cost may be higher because proprietary insurer data is often withheld and estimating damage can be challenging internationally.

The study indicates that when considering indirect costs, the Los Angeles area fires alone contribute at least $100 billion more to the global loss estimate. These fires burned about 90 square miles, resulted in at least 31 deaths, and displaced over 150,000 people. Additionally, experts suggest that smoke inhalation and other indirect causes led to hundreds more deaths.

Researchers compiled data from the EM-DAT database, which documents wildfire areas and damage. This database is part of a global research initiative focused on tracking disasters and their economic and environmental impacts. Although incomplete, it offers minimum estimates for damages from various disasters.