AI and Home Insurance – Personalizing Risk Amidst Rapid Changes

A dude using AI on his laptop to count wheat

In the past year, the insurance sector has seen tremendous change. As a result of the COVID pandemic, the automobile industry saw much less risk with fewer people on the road. Business and commercial insurance, however, face new threats of litigation for various reasons. And for homeowners, people found that they were spending much more time in their homes. Combined with climate change and major natural events, insurance companies have had to reconsider their strategies. Certainly, data analytics and property insurance have been used for years. But new ways of approaching AI and home insurance risk assessments are continuing to be developed.

Certain states have experienced greater impacts than others. For example, the state of California has not only had record numbers of COVID cases. It has also been devastated by wildfires over the last couple of years. Data analytics and property insurance companies have struggled to find coverage for some homeowners in these instances. But AI and home insurance solutions offer new hope. In fact, some bold businesses have positioned themselves well in using artificial intelligence. (Read up on the four industries AI will change by 2030 in this Bold story.) And many insurers are seeking partnerships in an effort to gain competitive advantage in the marketplace. By personalizing property insurance to a greater extent, risk management and coverage solutions are improving.

“Five of the six largest wildfires in California history occurred last year. As the costs of climate change continue to increase, it’s critical that the insurance industry and its customers look beyond the status quo and embrace emerging technologies like AI to better understand the risks associated with natural disasters.” – Attila Toth, CEO of

The Promise of AI and Home Insurance Analyses

Over the last decade, there has been roughly $2.2 trillion in losses attributed to floods, hurricanes, and wildfires. Likewise, these risks appear to be increasing with global warming and climate change. During this time, data analytics and property insurance analysis have attempted to accurately assess property risks. But given the highly dynamic state of things, and individual variations, this has been less than perfect. This is why companies are developing AI and home insurance solutions to better assess risk. In doing so, not only will many homeowners enjoy better opportunities for coverage. This will also save insurers millions of dollars each year.

An insurance policy and a house cutout
Data analytics and property insurance might not seem like they fit together, but AI use is helping determine likely outcomes.

While several companies are involved in AI and home insurance solutions, one notable one is This company was established in 2015 and is already making waves. The company uses high resolution aerial imagery, building material data, and location data to evaluate property risk. Combined with AI, its system uses over 200 billion data points to make these determinations. Specifically, Zesty’s AI has been trained using 1200 different wildfires that occurred over the last several decades. This platform therefore extends well beyond basic data analytics and property insurance evaluations. In fact, it offers a highly targeted approach in terms of risk analysis.

“With Cape [analytics systems], we acutely define the characteristics of a property and its surrounding area with a degree of accuracy that hasn’t existed before in home insurance to help our customers take important steps to protect their home.” – Aviad Pinkovezky, Chief Product Officer, Hippo

A Growing AI and Home Insurance Market

The data analytics and property insurance market has been expanding for years with increasing numbers of data-driven companies. But the more recent trend involves partnerships between existing insurance companies and startups. Many new companies are offering AI and home insurance products for insurance carriers. As a result, new partnerships are being formed. For example, Zesty recently partnered with Farmers Insurance in California. This specific partnership is expected to increase Farmers Insurance’s number of policyholders by some 30,000 people. With a more personalized and targeted assessment of property risk, Farmers Insurance anticipates serving a larger population.

Another important company in the AI and home insurance marketplace is Hippo Enterprises. Hippo is known as a home insurance tech firm that has long-used data analytics and property insurance assessments. It too is advancing, however, with geospatial imagery and other related technologies. It has added CAPE analytics to its solutions in recent years, which contributes loads of new data. The company has grown such that it now reaches 70% of all US homeowners in 35 states. Hippo is also seeking new partnerships as it advances its technology policy management systems. Like Zesty, it too offers targeted, personalized, insurance evaluations.

“The insurance industry over the last 100 years built a flawed process. It’s very difficult to purchase. It takes you two to three days to get hold of an agent, then you need to answer like 61 questions that you don’t know how to answer.” – Assaf Wand, CEO and Cofounder, Hippo

Insurance Industry Experts Anticipate Major Changes to Come

As many have recognized in the industry, existing insurance platforms are both outdated and cumbersome. Modernizing these platforms will certainly be important. Like other sectors, modernization will require the use of new technologies that offer a more personalized service and assessment. Data analytics and property insurance evaluations will become the norm. Likewise, experts expect more and more companies to embrace AI and home insurance innovations in the years to come. Both of these efforts will encourage a digital transformation of the industry. (Dive deeper into how digital transformation is a must in the post-COVID world in this Bold story.)

As part of this shift toward personalization, property assessments will become much more specific in identifying vulnerabilities. The use of AI and home insurance targeting will certainly pay closer attention to building data. But at the same time, adjacent terrains as well as historical information about the region will be important. The use of the AI will also enable insurance companies to better target specific clients for their unique services. We are only seeing the beginning of how data analytics in property insurance assessments will affect daily operations. But trends in this direction are already beginning. And based on the win-win outcomes occurring so far, more of the same can be expected.


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