Monday Market Update: The Use of AI in Insurance Coverage

Artificial intelligence (AI) continues to be a hot topic both in Silicon Valley and around the world. The United States is recognized as a leader in AI compute power and private investment and has been referred to as “the most AI-dominant country” by global publications. And just days ago, Realtor.com® revealed how a San Francisco-based insurance company is using this force to help insure certain types of homes in the worst climate risk areas of California & Florida. 

The use of AI in the insurance industry is not new, with the National Association of Insurance Commissioners reporting that 70% of insurers were using AI in 2024. AI is commonly used for claims, underwriting & marketing, fraud detection, rating and loss prevention. 



In 2025, the emerging and growing trend in AI use for property insurance pertains to improved forecasting risk for homes on a more individual level. Reputable insurance publication The Zebra explains that “New innovations can now blend satellite/aerial imagery, geospatial data and machine learning to forecast catastrophe losses and assess the risk of individual homes. That shift is changing premiums, underwriting speed, and even whether coverage is available in certain ZIP codes.”

On a local level, Stand Insurance was launched in 2024 by a group of what Realtor.com® calls “Silicon Valley tech veterans” and states that the company uses “physics-based AI models to underwrite policies and create customized fire resilience plans for properties in California’s wildfire-plagued areas where homeowners often struggle to secure coverage from traditional carriers.”

While most insurance carriers only account for the location of the property, Stand also considers the homeowners’ efforts to make their dwelling more resilient. Using AI to create a digital twin of each home, Stand insurance models simulate how various natural disaster types would affect the property. Then sample plans are created to reduce risks, with example action items such as replacing the windows or roof shingle, clearing the brush around the home, or swapping a wooden fence for a steel one. 

SO interesting, right? While Stand Insurance only covers homes in California valued between $3 million and $15 million at present, this type of risk model could be a gamechanger for the state insurance crisis. Let’s hope even more breakthroughs are yet to come! 

Read In Full: Insurance Startup Uses AI To Offer Coverage in High-Risk California and Florida

Cheers,

Bobbi

Bobbi Decker
DRE#00607999

Broker Associate, Bobbi Decker & Associates
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