2 million more homes can get wildfire mitigation discounts: IBHS

Takeaways:

• Participants must clear flammable material from 5-foot perimeter around homes
• Program now covers all western U.S. states and Florida
• California stops short on full mandate for mitigation discounts

The Insurance Institute for Business & Home Safety (IBHS) expanded its wildfire risk mitigation program, making nearly 2 million more homes eligible for a designation that gives insurers a clearer picture of a home's wildfire risk.

Homeowners who meet certain criteria in the expanded list of 14 states may qualify for discounts on their insurance. 

About 4.8 million homes in the U.S. are in areas with high or extreme fire risk, according to Michael Newman, general counsel at IBHS. Collectively, the 14 states in the program, which began with California, account for 3.1 million of U.S. homes with high or extreme wildfire risk. 

To participate in the Wildfire Prepared program, homeowners must remove anything flammable from a five-foot perimeter around the home, be at least 10 feet away from other homes, and eliminate any potential fuels such as cars, fences, trash cans and sheds. A neighborhood-wide designation is available for builders committing to the program's standard in construction.

"Wildfire Prepared Home designations are markers of both the home's survivability and insurability," Newman said. "It also sends a signal to the insurance industry that this is a better manageable risk, and we think insurers want to keep writing policies."

The five-foot buffer zone standard significantly reduces risk, as IBHS analysis shows. In the January 2025 Los Angeles wildfires, homes that had more than 25% fuel cover within five feet had a 90% likelihood of damage or destruction, according to Newman.

"Over half of them are outside of California, and that's really driven why, on the one hand, we started in California, but on the other hand, why it was so critical for us to expand beyond California," he said.

The 14 states with the most homes in areas of high fire risk account for 2.58 million homes collectively, according to Cotality. IBHS program states correspond with these, except for Florida, which is not on Cotality's list, while South Dakota is.

Arizona, Colorado, Florida, Idaho, Montana, Oklahoma, Texas, Utah, Washington and Wyoming are the 10 states joining the program, adding about 1.8 million more eligible homes. The first four states — California, Nevada, New Mexico and Oregon — account for about 1.3 million eligible homes. This leaves about 1.7 million eligible homes in the rest of U.S. states not in the program.

Participation in the program is subject to annual review, and participants must re-apply every three years to keep the designation, Newman said. "We do a quality assurance check to make sure that the homeowner has in fact undertaken those steps."

In February 2022, the California Department of Insurance issued its Safer From Wildfires framework requiring insurers to provide discounts for wildfire risk mitigation. The California Safe Homes Act (AB 888), along with several other insurance and wildfire laws, took effect on January 1. AB 888 authorizes grants to help residents mitigate fire risks, using the five-foot perimeter standard.

In a related development, the California Senate Insurance Committee voted down SB 1076, a bill requiring insurance companies to cover homes meeting fire safety standards, on April 23. The legislative outcome means that discounts are required by California's regulator but not enforced as state law.