In the second half of 2023, an unprecedented number of wildfires affected multiple countries in the Northern Hemisphere (Figure 1). These events were primarily driven by a series of extreme weather phenomena, including record-breaking heatwaves and exceptional lightning strikes. However, their scale and severity were not solely due to natural factors; human actions and societal decisions played a significant role. The events of 2023 have also raised concerns among insurers, who are experiencing an increase in wildfire-related claims and grappling with the implications of climate change, especially in the expanding wildland urban interface. As a result, risk managers are now tasked with understanding and effectively addressing the multifaceted drivers behind these increasingly frequent and intense wildfire disasters.
Following devastating fires in Chile during the Southern Hemisphere’s wildfire season earlier in the year (see WTW’s H1 Natural Catastrophe Review), wildfires in the second half of 2023 affected many regions, each with unique environmental and societal factors.
The Mediterranean region, including Portugal, Spain, Italy and Greece, faced an intense wildfire season as extreme heat seared the continent, hitting tourist areas — including Rhodes, Sicily and the Algarve — particularly hard. Affecting nearly 400,000 hectares of land, it has cost Europe an estimated €4.1 billion in economic damages.[1]
Greece, with its fragmented geography, faced its fiercest heatwave in decades,[2] leading to over 81,000 hectares burning in the Alexandroupolis region — the largest European wildfire since 2000.[3] The nation's numerous islands and strong winds complicated firefighting and containment efforts, with human negligence and arson exacerbating these challenges.[4]
Tenerife experienced its most severe wildfire in 40 years,[5] which burned for 87 days. Authorities suspect arson ignited the Arafo municipality fire, which rapidly spread across the island, affecting 11 municipalities and necessitating the evacuation of over 26,000 people. A total of 15,000 hectares were burned, with abandoned farmlands and rapid urban expansion toward forested areas fueling the fire,[6] raising questions about local preparedness and response strategies.
400 K hectares of land affected across Meditearranean region.
€4.1 B in estimated economic losses for Europe.
81 K hectares burning Alexandroupolis region of Greece - largest European wildfire since 2000.
15 K hectares were burned in Tenerife.
17.94 M hectares burned in Canada.
$700 M to $1.5 billion in estimated insured losses for Canada.
Canada witnessed its most extensive wildfire season on record, with 17.94 million hectares burned[7] — a new high for North America (see WTW’s H1 Natural Catastrophe Review). Despite most fires burning away from urban centers, the impacts were significant, with estimates of $700 million to $1.5 billion in insured losses,[8] six fatalities, over 155,000 evacuations[9] and 200 structures damaged.[10] The smoke from the wildfires traveled far, affecting air quality in the U.S. and Europe.[11] Additionally, the combined carbon dioxide emissions from the wildfires in both Europe and Canada exceeded 2 billion tonnes.[12] [13] [14] This equates to roughly 5% of current global annual emissions, contributing to global warming and its subsequent impacts.
In contrast, the U.S. saw a surprisingly calm wildfire season, with the American West's burned area 61% below the decade average.[15] From December 2022 to March 2023, California's heavy rainfall and increased Sierra Nevada snowpack significantly reduced the risk of wildfires, offering a rare respite for the fire-prone state.[16]
In Maui, Hawai`i, the Lahaina “firestorm,” as dubbed by the U.S. government,[17] showcased how environmental dynamics; societal actions, decisions and values; and gaps in readiness and response can join to create a multifaceted disaster. The combination of a high pressure system to the north and Hurricane Dora to the south resulted in strong downslope winds, reaching speeds in excess of 60 miles per hour toward Lahaina, propelling the fire’s spread at a rate of one mile per minute.
However, the scale of the human tragedy was compounded by infrastructural and administrative shortcomings, particularly notable in the critical gaps in emergency response systems. Neither state nor county authorities attempted to activate Maui’s extensive outdoor siren warning system, leaving many residents unaware of the impending danger until it was too late.
Road management during the evacuation process further contributed to the chaos and loss of life.[18] Maui Police’s decision to close certain roads to prevent civilians from encountering active fires and downed power lines inadvertently created extensive traffic congestion, limiting evacuation routes and trapping residents. The confusion was exacerbated by unclear communication about the status of the power lines, which, unknown to many, had been de-energized by Hawaiian Electric earlier in the day. This absence of information led to further unnecessary road closures, impeding evacuation efforts.
The wildfire, with at least 100 fatalities, was Hawai`i’s deadliest natural disaster since its statehood in 1959. Over 2,200 structures were destroyed, some historically significant, with financial costs exceeding $5.5 billion[17] (including approximately $3.5 billion of insured losses). This ranks as Hawai‘i’s second costliest natural catastrophe in the state’s history. Beyond these direct consequences, the wildfire also impacted community wellbeing, long-term health and cultural heritage. Wildfires like this not only consume trees and homes but also engulf centuries of history, traditions and landmarks, turning them into more than natural disasters; they become cultural catastrophes.
Maui has experienced other serious fires in recent years. The 2018 Lahaina fires, under atmospheric conditions strikingly similar to those in 2023, were less severe, claiming no lives and burning approximately 1,000 hectares. This contrasts sharply with the 6,880 hectares burned in 2023. A critical difference in 2018 was the precautionary evacuation of Lahaina Town. In 2023, similar evacuation measures were absent, so when the flames crossed Lahainaluna Road — a barrier they hadn’t crossed in 2018 — they engulfed a town still filled with residents and tourists, leading to a significantly greater loss of life and devastation.
The 2023 wildfires reveal a complex interplay between local factors, climate change and societal interactions, highlighting operational vulnerabilities worldwide. As human expansion in the wildland urban interface continues, these challenges intensify, requiring a multifaceted approach that combines early forecasting and anticipation of wildfires with robust infrastructure, effective communication, adaptable policies, ecological restoration and community-focused recovery strategies.
The United Nations secretary-general’s “Early Warnings for All” initiative, aiming for global readiness with essential systems by 2027,[19] highlights the importance of enhancing early warning systems. Yet, the failure of Lahaina's own early warning system amid rapidly changing environmental conditions shows that technological enhancements are only a part of the solution. Broader strategies are essential.
For example, the dramatic increase in wildfire occurrences in Hawai`i, stemming from the replacement of native forests with highly flammable non-native grasses,[20] and the extensive fires in Tenerife, fueled by neglected, overgrown farmlands, underscore the vital role of ecological restoration and proactive land management.
Restoring native ecosystems and developing fireresistant infrastructure, combined with effective management of neglected lands, are key to enhancing safety and resilience against escalating wildfire threats.[21]
Recovery from wildfires also requires efforts to revitalize communities, restore livelihoods and address emotional trauma. Recovery strategies need to be community-focused, avoiding exploitative practices post-disaster[22] and ensuring overall wellbeing. The insurance sector emerges as a key player, not just in financial recovery but also in promoting resilience and risk-aware policy pricing. To effectively manage these risks, insurers require advanced natural hazard modeling tools. The development of such models has tended to focus on North America, especially California. But progress is being made in other regions. For example, WTW Research Network partner Mitiga Solutions is developing advanced wildfire models for Europe and Chile that span from immediate weather forecasting to long-term climate predictions.
Additionally, all of these events challenge the effectiveness and sustainability of forestry-based carbon offsets. The Taskforce on Nature-related Financial Disclosures is expected to provide clarity and oversight to these complex issues in future standards.
Reflecting on the lessons from 2023, it becomes evident that effectively managing wildfire challenges in a warming world requires a delicate balance of global coordination and local action. While a unified global approach is indispensable for large-scale strategy and resource allocation, the crucial role of local actions and community involvement cannot be overstated. This necessitates continuous investment in research, innovation and the adaptation of strategies to effectively address the multifaceted nature of wildfires and similar natural disasters.
