Catastrophe Modeling for Life & Health Insurance Examining L.A. Wildfire Impacts

Background and Purpose

Catastrophe models can be important to life & health insurance actuaries who model risks associated with disaster events. The recent wildfires in the Los Angeles, California (L.A.) area is an example of an extreme impact, not only from a property and economic perspective, but also from a mortality and morbidity perspective. Some of the health impacts from the wildfire events relate to burn injuries, as well as toxic smoke and resulting poor air quality.

As of January 16, according to the Los Angeles Times: The long-term health effects of L.A. County wildfire smoke - Los Angeles Times,

The L.A. wildfires have coincided with a 16-fold rise in hospital visits for fire-related injuries, such as burns and smoke exposure.
Although the smoke’s immediate effect has begun to dissipate, lingering ash and toxic chemicals in burn areas probably will be a long-term public health concern.

And as of January 17, at least 29 people had died directly as a result of the L.A. area wildfires. The long-term impact on mortality includes adverse health effects from lower air quality and burns, which are not yet known. California wildfires: What we know about the people killed

The Society of Actuaries Research Institute (SOA) Catastrophe & Climate Strategic Research Program seeks essays that explore considerations for catastrophe modeling for life and health insurance companies. A priority is to highlight the recent L.A. area wildfires as an example.

Accepted essays that will be published on the SOA webpage should explore the impacts to insurers through modeling of catastrophe events and what constitutes a “catastrophe.” Essays should discuss how to approach events that become so large in scope as not to be insurable because they may not be able to be diversified away as part of risk pooling, at which point the insurance mechanism breaks down. For life & health catastrophe risks, what is the best framework or mechanism to cover the event and what is the role of life & health insurance and actuaries? Essays could discuss how to improve catastrophe models for morbidity and mortality.

With these issues in mind, the Society of Actuaries Research Institute is interested in an exploration of this topic from a variety of perspectives. The result of this effort is intended to initiate discussion regarding the impact of catastrophe events on life & health insurance and to set the stage for future research.

Scope

We seek essays that pertain to life & health insurance catastrophe events that may impact the U.S. and Canadian insurance markets. For essays studying markets beyond the U.S. and Canada, it will be preferable to note how conclusions are applicable irrespective of the market.

Illustrative points of the essay in the context of the L.A. area wildfires and how they have, and in the future may, influence insurance company practices should be highlighted as part of the essay.

Sample Topics of Interest for Essays

This invitation is written broadly to allow respondents the flexibility to address this topic from one or a range of perspectives and approaches. Respondents are free to choose from one or more of the following sample topics below or propose others that fall within the scope of this Call for Essays as described in the above section. Please note that this list merely consists of examples of proposed topics that may be covered. Respondents are welcome to address other questions or topics that fall under the general scope of this call for essays.

Sample topics include:

What are the unique considerations for life, health, and property-casualty insurers in managing and modeling risks associated with catastrophic events?
What are the parallels between “insurability” for property, life, and health risks in the aftermath of singular large-scale events or in the aggregate of smaller / mid-sized events?
Discuss current catastrophe modeling approaches, including event definitions, damage functions, data/sources, and output quantities relevant to life, health, and/or property-casualty insurance? In this context, catastrophe modeling includes forecasting future risks and testing for solvency/soundness.
Are current modeling approaches adequate for the needs of property-casualty, life, and health insurers? If not, what modifications to existing approaches or new approaches should be explored?
What risk transfer mechanism(s) could life and/or health insurers implement in preparation for possible future catastrophic events beyond traditional risk pooling mechanisms, assuming that catastrophes may be too large to be pooled?
Should life and health insurers reflect the risks associated with catastrophes such as the L.A. wildfires in their liabilities or economic capital or should they be reflected in premiums? If so, how? What effect do these risks have on the sustainability of the life or health insurance industry and/or on individual insurers?
How could non-property focused catastrophe models simulate scenarios to test life & health insurer solvency?
If partnerships (e.g., involving private and public sector participants) are considered, what mechanisms would be beneficial to address catastrophe events?
What lessons can be learned by property-casualty, life, and/or health insurers from the L.A. wildfires?
What types of resilience should be emphasized to minimize the loss of life, health, or property?
What role might artificial intelligence (AI) and other advanced analytical techniques play in identifying, measuring, and mitigating risks for property-casualty, life, and/or health insurers?

Rules for Submission of Essays

Timeline

The deadline for essay submissions is June 18, 2025. Essays will be published as soon as possible in a formal collection.

Length and Instructions for Submission

Essays must be submitted in English with a desired length of between 500 to 2,500 words. There is no requirement for formal or extensive footnoting.

Author information must be submitted with the essay and include name; credentials or designations (if appropriate); title; organization/company; e-mail address; and phone number. Please provide all author information at the beginning of the essay.

Essays that contain any overt political statements, commercial content, and other inappropriate material will not be accepted. Articles must comply with the SOA's antitrust guidelines.

Please submit your essay via e–mail to Research-CC@soa.org.

Awards

Up to $10,000 in award money has been allocated for this call for essays. The review committee will select the leading essays and determine how to allocate the award money among them. Consideration will be given to creativity, originality, and the extent to which an idea might help promote further thought in this area. In exchange for award money, selected authors will be required to assign all copyrights in their essays to the Society of Actuaries Research Institute.

Authors are ineligible for awards if an essay is based on an SOA Research Institute-sponsored and funded research study conducted by the author. However, authors are welcome to submit such essays for publication consideration.

Publication and Presentation

Depending on how many essays are received and the range of the topic areas, a suitable format for electronic publication and dissemination will be selected. Essays may also be presented at an SOA meeting, webcast, or other professional development event.

In addition, other venues for publication or presentation of the ideas outside of the Institute will be considered. It is hoped that publication of the collected essays will further knowledge and stimulate discussion as well as promote future efforts in this area.

Rights Granted

Please understand that by submitting an essay for consideration, the essay author(s) is granting to the Society of Actuaries Research Institute an unlimited license to print or republish their essay, with proper attribution given to the author(s).

Questions

Please direct any questions regarding this Call for Essays to Research-CC@soa.org .