ZestyAI Enables Insurance for 500,000 Properties Using AI

ZestyAI, an insurance risk analytics provider that uses artificial intelligence to assess property risks, helped insurance carriers extend coverage to more than 511,000 previously uninsurable properties in 2024. 

The firm now aims to double this figure in 2025, potentially bringing insurance options to over one million homes and businesses in catastrophe-prone regions.

The development comes as the insurance industry struggles with coverage gaps in high-risk areas. 

According to a 2024 Deloitte survey, nearly a quarter of homeowners in high-risk states cannot find coverage, whilst more than half report affordability as a growing concern.

"For too long, insurers have had to make high-stakes decisions with incomplete information," says Attila Toth, Founder and Chief Executive Officer of ZestyAI. 

"Advanced AI models are changing that. With granular, property-specific risk insights, insurers can close protection gaps and build a more resilient market."

Traditional methods vs AI-driven approaches

Conventional risk assessment methods in the insurance sector rely on territory or postcode-level evaluations, which fail to account for specific characteristics of individual properties. 

This approach has contributed to adverse selection in insurance portfolios and market withdrawals as losses increase.

ZestyAI has developed models that integrate climatology, geospatial data, historical losses and structural attributes to deliver property-specific views of wildfire, hail and wind risk. 

These models allow insurers to make decisions based on the actual risk profile of each property.

The technology provides mitigation guidance for policyholders, enabling them to take steps to reduce their risk. It also supports risk-aligned premiums, which can facilitate market expansion into areas previously considered uninsurable.

The firm's platform offers underwriting precision through AI-generated risk scores covering nearly all properties in the United States. 

Insurers can optimise loss cost controls by creating effective deductible structures, Actual Cash Value (ACV) policies – where claims payouts reflect depreciation rather than replacement cost – and coverage strategies tailored to specific risk levels.

Regulatory collaboration expands access

ZestyAI has secured regulatory approval for its wildfire model, called Z-FIRE, across Western states in the US. Its severe convective storm models – which assess risks related to thunderstorms, tornadoes, hail and straight-line winds – have gained acceptance from Texas to Colorado and throughout the Midwest and Great Plains regions.

The company works with regulators to ensure transparency and validation of its models. 

This regulatory cooperation has helped establish a framework for risk-based pricing and proactive mitigation measures, which are aimed at revitalising the core function of insurance: protecting property owners and their communities.

The firm's technology also streamlines property inspections, reducing expenses for insurers while improving operational efficiency. 

This allows carriers to process applications more quickly and communicate risk factors more clearly to potential policyholders.

ZestyAI combines its AI models with robust data sources to deliver insights for various perils including wildfires, severe convective storms, and non-weather-related hazards. 

These insights are validated by climate science and historical loss data, enabling more informed underwriting decisions, accurate rating, and improved reinsurance outcomes.

By helping carriers align premiums with risk profiles, increase accessibility, and prioritise mitigation strategies, ZestyAI aims to foster a healthier insurance market that benefits all stakeholders, from carriers to consumers in regions facing increasing climate risks.

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