Wildfires Across Europe: Comment & Analysis

A quick round up of comments, data and analysis surrounding the outbreak of fires across most of western Europe recently.

SPHERA

Sam Perry, Group Vice President at Sphera, comments:

“Wildfires like those affecting southwest Europe demonstrate how quickly a localised climate event can become a broader operational challenge. We’re already seeing reports of disruption to clothing distribution during the summer sales period, while the Gironde region is also home to aerospace and advanced manufacturing businesses that depend on highly interconnected supplier and logistics networks. For businesses with suppliers, manufacturing sites or transport routes in the region, the priority is understanding where exposure exists across the supply chain as the situation develops.

“Our research found that 73% of organisations experienced financial or operational losses from supply chain disruption last year. Data from Sphera’s risk platform suggests wildfire-related disruption is becoming an increasingly recurring challenge, with more than 30 supplier disruption events identified across France, Portugal, Spain and Greece over the past three years. Events like this highlight why understanding supplier networks beyond Tier 1 has become increasingly important. The direct impact of a wildfire may be geographically contained, but the operational impact rarely is. It’s often the indirect dependencies, shared logistics providers or specialist manufacturers that create the greatest operational challenges when a regional event unfolds.

“Many organisations still struggle to map those dependencies beyond their direct suppliers, particularly where specialist manufacturers or shared logistics providers are involved. That visibility becomes particularly important in regions like southwest France, where multiple industries rely on concentrated manufacturing and transport networks. As the situation develops, businesses with operations or suppliers in the region will be assessing where those dependencies exist and how quickly alternative arrangements can be put in place. The organisations able to answer those questions early are typically in a much stronger position to limit downstream disruption.”

GUY CARPENTER

Guy Carpenter’s Insights include:

• More than 90,000 hectares have burned in Spain during July and more than 50,000 hectares in France, with several exceptionally large fires continuing to evolve across southern Europe.
• Most of the burned areas have so far been in rural regions with relatively limited property insurance impacts, but the report notes that if fires spread further into urban areas such as Madrid or Bordeaux, insured property losses could become significant.
• The Gironde wildfire alone forced the evacuation of approximately 253,000 people, destroyed around 240 homes and required the deployment of 2,750 firefighters and 1,500 soldiers, illustrating the scale of the event.
• The report identifies crop and vineyard damage, smoke exposure, evacuation costs, business interruption, and transport disruption as the key emerging loss drivers, reinforcing that the economic impact of wildfires extends well beyond direct property damage.

Julian Enoizi – CEO, Europe, Guy Carpenter – highlights the following:

“The current fires reinforce two important trends. First, today’s insured losses remain relatively contained because many of the fires have affected rural areas, but that picture could change quickly if they spread further into more densely populated regions. Second, the biggest impact increasingly extends beyond property damage, with business interruption, smoke, evacuation, and supply chain disruption all contributing to the economic cost. That’s why wildfire is becoming a resilience challenge as much as an insurance challenge.”

FITCH RATINGS

Fitch Ratings expects a limited near-term impact on most large European insurers’ 2026 earnings from the wildfires in France and Spain. There is a lack of state-backed reinsurance cover for these events, but loss costs should be manageable so long as the fires do not reach concentrated residential, commercial or industrial exposures.

By late July, the fires had burned around 117,000 hectares in France and over 200,000 hectares in Spain. They have caused several fatalities and nearly 300,000 people to be evacuated.

Barring urban spread or multiple follow-on events, we would expect only modest pressure on 2026 earnings for most large European insurers, and hence no rating implications. Nor do we expect this event alone to change the broader softening trend in property catastrophe reinsurance. Pricing may become more differentiated for high-risk areas or for cedants with weaker prevention and exposure management.

Loss costs would rise materially if the fires spread into densely populated or industrial urban areas, for example near Bordeaux or Madrid, as damage to concentrated insured property assets is the main loss driver. This was seen in the January 2025 Los Angeles wildfires, where their urban spread destroyed over 10,000 homes and drove around USD40 billion of insured losses, the costliest wildfire event on record. Reported structure losses in France and Spain so far appear much lower, but further effects remain a risk. Significant areas in both France and Spain have been affected by wildfires through August and September in previous years.

ARSON ARRESTS AND INCIDENTS

Although climate change is being blamed as the primary cause of all EU and UK wildfires this summer, a deep dive into the data on arrests for suspected arson, or reckless use of disposable bbqs, campfires etc. tells a different story. As is often the case, and has been since the great fire of London in the 1660s, human negligence is often the primary cause of ignition.

UK

Youths arrested after starting a fire in woodland in Staffordshire. 

Woman charged after setting off fireworks near Dovestones in Derbyshire.

Bored youths make their own firestarter fun in the school holidays in Ellesmere Port.

Deliberate fires set in Harlow Essex, says Fire Service.

FRANCE

Over 300 arrests for suspected arson, of which 127 were minors, say French Departments.

Le Monde report in July states 9 out 10 wildfires in France have a human cause.

SPAIN

Large fire near Madrid possibly caused by man using agricultural equipment, arrest made, says Guardia Civil.

Two men arrested after deciding to do some welding in 40 degree heatwave, starting a fire near Toledo.

Suspected detained and remanded after fire near Carme.

GREECE

Local Mayor and other public sector employees arrested after wildfire.

Around 197 arrests for negligence or suspected arson by mid July, says Greek media.

There are dozens more, do your own research.

Insurtechs and data specialist companies would be wise to collate the data regarding deliberate arson each summer, pinpointing locations, ages of suspects, accelerants used and more to provide an accurate arson mapping baseline, which can be fed into property insurance platforms. This problem is likely to get worse, not better.