More than 2.5 million properties across the 10 most exposed states in the western U.S. carry a moderate or greater risk of wildfire, representing a combined reconstruction cost value of nearly $1.4 trillion, according to Cotality’s 2026 Wildfire Risk Report, released on August 12, 2026.
The report reveals a critical blind spot in how insurers and homeowners assess wildfire danger: traditional wildfire models often overlook conflagration, where fire spreads from home to home, which can add up to 40 points to a property’s risk score and push significant hazard into areas previously labeled low risk. That means thousands of homes thought to be safe may actually face substantial wildfire exposure.
California remains the most exposed state, but nearly half of at-risk properties are outside its borders, with Colorado, Texas and fast-growing metros such as Austin and Denver showing substantial exposure. For buyers, sellers, and homeowners in these regions, the findings underscore the growing importance of understanding wildfire risk when evaluating a property—and the urgent need to verify that insurance coverage reflects the real threat.
The numbers
Where the risk is concentrated
California holds the largest share, but exposure is spreading rapidly across the West
California remains the most exposed state, with 1.28 million at-risk properties and $850 billion in reconstruction cost value. But nearly half of all at-risk properties across the top 10 states (49.9%) are located outside California.
Colorado and Texas together account for nearly 560,000 at-risk properties and $252 billion in RCV, almost matching the $277 billion of exposure across the remaining seven states combined. Oregon, Arizona, Idaho, New Mexico, Montana, Washington and Utah round out the 10 most exposed states.
At the metro level, Los Angeles leads with nearly 250,000 at-risk properties representing more than $209 billion in RCV. Austin, Texas follows as the leading non-California metro, with more than 100,000 at-risk properties and $49.2 billion in RCV, ahead of San Antonio, Denver, and Spokane, Washington.
The 10 most exposed states
California: 1.28 million properties, $850 billion in reconstruction value
Colorado & Texas combined: 560,000 properties, $252 billion
Remaining 7 states (Oregon, Arizona, Idaho, New Mexico, Montana, Washington, Utah): $277 billion combined
Total exposure: 2.5+ million properties, $1.4 trillion
The missing piece
Why conflagration changes everything
Traditional models miss the biggest threat: fire jumping from house to house
The most important finding in Cotality’s 2026 report isn’t the number of homes at risk—it’s how many properties are being misclassified by models that focus only on wildland fire. Cotality’s modeling reveals how conflagration—when the fuel for fire moves from wildland into a neighborhood, spreading home to home—is reshaping the geography of wildfire exposure and revealing a significant vulnerability that traditional risk models can overlook.
Layering conflagration potential onto a traditional wildfire risk score can create a more holistic view of a property’s risk and add as many as 40 points to its risk score, pushing meaningful hazard risk deep into neighborhoods legacy maps previously classified as low risk. That’s the difference between a property being deemed insurable at standard rates and being flagged as high-risk—or uninsurable altogether.
Conflagration risk depends on factors traditional models ignore: structure density, building characteristics, wind patterns, and ember influence alongside terrain and natural fuels. A home with cleared defensible space and fire-resistant roofing can still burn if surrounded by closely spaced wooden structures in the path of wind-driven embers.
The full report is available on Cotality’s website, and the company released the findings via Business Wire on August 12, 2026.
What it costs
The insurance and affordability crisis
Premiums are surging, coverage is vanishing, and mitigation may be the only path forward
Wildfire risk is no longer an abstract modeling exercise. It’s driving a homeowners insurance crisis that is reshaping who can afford to buy—and keep—a home in fire-prone areas. As the homeowners insurance crisis has evolved into a structural mortgage origination problem, the coverage complications and debt-to-income disruptions once concentrated in California are beginning to reach states where brokers had not previously needed to account for them at the preapproval stage.
The report introduces a property-level mitigation score that measures three dimensions: community protections, on-property conditions, and fire-resistant construction. The financial gap between prepared and unprepared homes is stark. Homes in the top 10% of mitigation scores carry expected losses roughly 78% below the statewide average, while homes in the bottom 10% run more than ten times that average, about $47 in expected loss for every $1 carried by the best-prepared homes.
In practical terms, that gap translates directly into insurability. Carriers are using these property-level scores to decide not just pricing, but whether to offer coverage at all. Homes with low mitigation scores are being non-renewed or pushed into state FAIR plans with coverage caps and higher premiums, while homes with documented mitigation are securing standard market coverage.
Mitigation pays—literally
The difference in expected wildfire loss between the top 10% and bottom 10% of homes by mitigation score: 78% lower losses for well-prepared homes versus $47 in expected loss for every $1 on the best-prepared properties for the least-prepared homes. That’s not a rounding error—it’s the difference between affordable coverage and no coverage at all.
Policy shift
Colorado’s new transparency law takes effect
Starting July 1, 2026, insurers must disclose wildfire risk scores and credit mitigation work
Colorado’s HB25-1182, signed into law in May 2025 and taking effect July 1, 2026, represents the most significant wildfire insurance reform in the state’s history. Beginning July 1, 2026, any insurer that uses a wildfire risk model, a catastrophe model, or any scoring method to underwrite, price, non-renew, or surcharge premiums on a homeowners insurance policy in Colorado will be legally required to share that information with the policyholder—and to incorporate the mitigation work that homeowners have actually done into their risk calculations.
The law creates three new rights for Colorado homeowners: insurers are required to send an annual written notice that includes the wildfire risk score, any other wildfire risk classification they used, and the mitigation discounts available. Homeowners can appeal their scores, and insurers face a 10-day acknowledgment and 30-day decision deadline for those appeals.
The law doesn’t guarantee lower premiums, but it does give homeowners leverage they didn’t have before. For Colorado homeowners who have been spending thousands of dollars on defensible space, fire-resistant roofing, or ember-resistant vents without any confirmation that those investments are being credited by their insurer, this law changes the equation.
The full text of the law is available on the Colorado General Assembly website. For buyers considering a home in Colorado, understanding your property’s wildfire risk score before closing is now a critical part of due diligence.
For buyers
What to do with this information
Wildfire risk is now a cost you can measure before you buy
If you’re shopping for a home in any of the 10 most exposed states, wildfire risk is no longer a vague concern—it’s a line item in your housing budget. Here’s how to factor it into your decision before you make an offer.
Ask for an insurance quote before you waive contingencies. Don’t wait until a week before closing to find out that the home you’re buying is uninsurable in the standard market. Get a binding quote that includes the property address, and confirm the premium and coverage limits in writing. If the only option is a state FAIR plan, factor that cost—and the coverage gaps—into your offer price.
Request the property’s wildfire risk score. In Colorado, insurers are now required to disclose this. In other states, ask your insurance agent to pull the score from whatever model the carrier uses. A score above 70 (on a 1-100 scale) typically triggers surcharges or non-renewals. A score above 85 often means standard market coverage isn’t available at any price.
Evaluate mitigation as part of the inspection. Look for fire-resistant roofing (Class A rated), ember-resistant vents, non-combustible siding, and at least 30 feet of defensible space with low vegetation. These aren’t cosmetic upgrades—they’re the features that determine whether the home is insurable. If they’re missing, get bids for the work and negotiate the cost into the purchase price.
Understand your mortgage lender’s requirements. Most lenders require proof of insurance before funding the loan. If the property is in a high-risk area and standard coverage isn’t available, your lender may require force-placed insurance, which can cost two to three times a standard policy and will be added to your monthly mortgage payment. That can push your debt-to-income ratio above qualifying limits and kill the deal.
For buyers in California, Texas, Oregon, Arizona, Idaho, New Mexico, Montana, Washington, and Utah, wildfire risk is now as fundamental to the buying decision as the school district or the commute. Treat it that way.
Quick answers
Wildfire risk: common questions
How do I find out my property’s wildfire risk score?
Contact your homeowners insurance company and ask directly. In Colorado, insurers are legally required to disclose your score as of July 1, 2026. In other states, request it from your agent—most carriers use a scoring model and can provide your property’s rating. If you’re buying a home, ask for the score before you make an offer so you can factor insurance costs into your budget.
What is conflagration risk and why does it matter?
Conflagration is when wildfire spreads from structure to structure rather than burning through wildland vegetation. Traditional wildfire models focus on terrain, vegetation, and distance from wildland—but conflagration depends on building density, construction materials, and wind patterns. A property can have low wildland fire risk but very high conflagration risk if it’s surrounded by closely spaced wooden homes. Adding conflagration to a risk score can increase it by up to 40 points, which often moves a property from insurable to uninsurable in the standard market.
Will wildfire mitigation lower my insurance premium?
It depends on the state and the insurer. In Colorado, HB25-1182 now requires insurers to credit documented mitigation work. In other states, some carriers offer discounts for fire-resistant roofing, defensible space, and ember-resistant vents, but it’s not mandatory. The bigger benefit is often insurability—homes with strong mitigation are far more likely to qualify for standard market coverage, while homes without it may be non-renewed or forced into expensive state FAIR plans.
What does it mean if my home is in the “top 10 most exposed states”?
It means your state has a high concentration of properties facing moderate or greater wildfire risk. The 10 states are California, Colorado, Texas, Oregon, Arizona, Idaho, New Mexico, Montana, Washington, and Utah. Being in one of these states doesn’t automatically mean your specific property is high-risk—risk varies widely within each state based on location, vegetation, building materials, and local fire history. But it does mean you should verify your property’s individual risk score and confirm insurance availability before buying.
Can I still get a mortgage if my property is high wildfire risk?
Yes, but insurance is the gatekeeper. Mortgage lenders require proof of homeowners insurance before funding the loan. If your property is high-risk and you can’t get standard market coverage, you may need to use a state FAIR plan or surplus lines carrier. FAIR plans often have lower coverage limits (sometimes capped at $750,000 or less) and higher premiums, which increases your monthly housing payment. If the added insurance cost pushes your debt-to-income ratio above your lender’s limit (typically 43-50%), you may not qualify for the loan.
Is wildfire risk getting worse, and what’s driving it?
Yes. The 2026 report notes that seasonal forecasts indicate 2026 may bring one of the strongest El Niño events in modern history, which Cotality scientists expect to redistribute wildfire risk rather than reduce it. Conditions in the Southwest should ease once winter precipitation arrives, while the Pacific Northwest is expected to dry into conditions associated with larger, more extreme fires. Long-term, the combination of prolonged drought, hotter temperatures, expanded development in wildland-urban interface zones, and more frequent wind events is increasing both the frequency and severity of wildfires across the West.