Alberta Wildfire Could Cost Insurers $4.6 Billion, Ratings Agency DBRS Says

The Fort McMurray wildfire could cost insurers as much as C$6 billion ($4.6 billion), making it by far the most expensive Canadian natural disaster, according to ratings agency DBRS.

More than 2,400 properties have been destroyed or damaged and, using a wildfire in Slave Lake, Alberta in 2011 as a benchmark, claims costs are likely to range between C$2 billion and C$6 billion, DBRS said, based on the latest information.

"This is an historically large number for the Canadian insurance industry in terms of catastrophic claim events, and is shaping up to be the most expensive catastrophic natural disaster event in Canada," the ratings agency said on Friday.

The Slave Lake fire was previously Canada's biggest insurance loss from wildfire. The costliest natural disasters were the C$1.9 billion in losses from the North American ice storm of 1998 and the Alberta floods of 2013.

DBRS said the credit ratings of major insurers operating in Canada were not expected to be impacted because direct insurers had reinsurance programs in place for such events.

Canada's largest property and casualty insurer Intact Financial Corp said on Monday it would suffer losses ranging from C$130 million and C$160 million.

Other insurers with significant exposure in the region include the insurance arm of Toronto-Dominion Bank and AIG.