Wildfires: An Outdoor RMs Loss Worry

Because wildfires have caused the closing of national parks and state forests, "it becomes a business interruption by civil authority issue," explained Glenn Sudol, executive vice president and underwriting manager for Gillingham & Associates, a managing general agency in Westminster, Colo.

Mr. Sudol said his agency insures destination resorts and guest ranches for all lines except workers' compensation. It also insures outfitters and hunting and fishing guides

Recent wildfires have affected rates on "almost a case-by-case basis," he said. "It affects us because we insure a large percentage of the guest houses and resorts that are in the [Colorado] mountains."

So far the biggest losses due to wildfires were last year in Wyoming, "a terrible year for forest fires," he said. "There were a lot of claims out of that for loss of property and business interruption, and they closed the forest so a lot of our outfitters couldn't operate in some of the parks."

Hunting guides holding permits in designated areas who are told they can't operate in those areas can get "stuck with an insurance bill and no clients," he said. "We've gone back to some clients and said 'send a note about what happened and we'll get some money back to you.'"

Drew Leiman, risk management director for National Outdoor Leadership School in Riverton, Wyo., which trains instructors for outdoor adventure programs such as Outward Bound USA, YMCA, universities and other organizations, said NOLS closely monitors wildfires and other situations in parks where training programs are scheduled.

"We're fortunate because we're established and have good relationships with the [park] agencies," he said. "We can move from one forest to another and they'll work with us." Some smaller organizations have more difficulty in this area, he said.

In terms of other wilderness risks, Mr. Leiman said NOLS continually evaluates and analyzes risks, which include rock falls, large rivers, oceans, weather and avalanches.

"We state clearly that we cannot ensure anyone's safety on a course," he said. "Things can happen that are well beyond our control, but we manage the risks."

Lewis Glenn, vice president, safety and programs for Outward Bound U.S.A., an outdoor adventure education program for adults and youths headquartered in Garrison, N.Y., said Outward Bound is affected by wildfires every year but has not had to close locations or cancel programs because of them.

Outward Bound insures 41 base camps and their contents in the U.S.A. and one in Mexico, he said.

Insurance Services Offices Inc. in Jersey City, N.J., last week estimated that insurers will pay about $120 million to homeowners and businesses in Arizona alone for insurer property losses due to the recent Rodeo-Chediski Complex wildfire.