California Wildfires Ignite Concerns For Insurance Stocks: Here Are Some Insurance ETFs Which Could Be Impacted

California-based property and casualty insurance stocks and exchange-traded funds are in focus as the Los Angeles wildfires have wreaked havoc and ruined over 10,000 structures.

What Happened: As five fires continue to burn LA County, the Eaton and Palisades fires have caused significant damage, destroying over 10,000 structures, including homes, businesses, and smaller buildings, reported USA Today. The County of Los Angeles Department of Medical Examiner said that 10 fire-related deaths have been reported.

Allstate Corporation ALL and Travelers Companies Inc TRV are prominent California-based property insurers. As reported by Benzinga, many homes in the affected areas are insured by the state-backed insurer of last resort, the California FAIR Plan.

California’s insurance market was already in crisis before the recent wildfires. Insurers withdrew from the state due to mounting losses from increasingly frequent and severe fires. This issue was highlighted by actor James Woods, who revealed that his neighborhood recently lost its insurance coverage.

See Also: Charlie Munger’s Top Pick Costco Reports Strong December Sales: Analysts Expect A 7% Jump In January

Why It Matters: AccuWeather estimates the economic toll of the Southern California wildfires at a staggering $52 billion to $57 billion. This figure includes damage to property and the disruption of daily life. Chief Meteorologist Jonathan Porter warns that this could become the most devastating wildfire in California history if the fires continue to spread.

The ETFs holding Allstate and Travelers include iShares U.S. Insurance ETF IAK, Invesco Dow Jones US Insurance UCITS ETF Acc INSU, and Invesco KBW Property & Casualty Insurance ETF KBWP. These two stocks are part of the top five holdings of IAK, INSU, and KBWP, and they will be in focus as markets open on Friday.

Following are the weights of these stocks in the mentioned ETF.

Read Next:

• Nancy Pelosi’s Stock Pick Palo Alto Networks Gets A Downgrade From Top Investment Bank As Sector-Wide Consolidation Down-Cycle Weighs on Sentiment

Photo courtesy: Wikimedia