Southern California Edison (SCE), the California electrical utility, has entered into a $2.2 billion agreement to settle all subrogation claims in the pending litigation arising from the 2018 Woolsey Fire.
Previously, SCE had agreed to pay $1.6 billion for claims related to the 2017 Thomas and Koenigstein fires and 2018 Montecito Mudslides.
At the same time, the firm warned that a subrogation agreement related to the Woolsey wildfire was to be expected and subsequently raised its reserves for wildfire related claims.
In an update, SCE has said that it has entered into an agreement with the holders of Woolsey Fire insurance subrogation claims which settles all subrogation claims in the pending litigation.
Additionally, SCE has reached settlements with around 1,000 individual plaintiffs in litigation arising from the 2017 – 2018 wildfire/mudslide events, which include the Woolsey Fire, the 2017 Thomas and Koenigstein fires, and the 2018 Montecito Mudslides.
Under the latest settlement, plaintiffs are set to receive $2.2 billion within 90 days for claims based on payments already made to individual and business policyholders associated with the Woolsey Fire. Furthermore, SCE has said that it will pay additional amounts for claims arising from future payments that may be made to policyholders on or prior to July 15th, 2023.
Pedro Pizarro, President and Chief Executive Officer (CEO) of Edison International, parent company of SCE, commented: “We have made another significant step toward resolving pending wildfire-related litigation.
“This settlement is with all insurance subrogation plaintiffs in the 2018 Woolsey Fire litigation. Combined with the settlement announced on Sept. 23, 2020, in the TKM litigation, SCE has resolved all subrogation plaintiff claims for the 2017/2018 Wildfire/Mudslide events. The company continues to explore reasonable settlement opportunities with other parties.”
Taking this settlement into account and other available information, the company’s best estimate of total losses for the 2017/2018 Wildfire/Mudslide events remains the same – at $4.6 billion as of the end of Q3 2020.
As SCE explains, this total will be reduced by the initial $2.2 billion to be paid under the settlement.
SCE also states that it has $700 million remaining in expected recoveries from insurance for the Woolsey Fire, but warns that this will be exhausted after expected recoveries from the settlement.
