Zesty.ai and IBHS to Partner on Predictive Analytics for Climate Risk

The alliance will allow building science testing from IBHS’s research center to be scaled across millions of homes and businesses.

(Image of wildfire testing of construction materials at the IBHS. Source: Zesty.ai.)

Zesty.ai, an Oakland, Calif.-based artificial intelligence (AI) InsurTech startup, has joined the Insurance Institute for Business & Home Safety (IBHS) to apply practical research, extensive historical loss data, and machine learning to the risks the organization studies. The alliance will allow building science testing from IBHS’s research center to be scaled across millions of homes and businesses using the power of artificial intelligence and cloud computing, according to a Zesty.ai statement. By collaborating in the study of the effects of weather and climate catastrophes, the organizations say they expect to make significant headway in strengthening communities and the insurance industry with better climate risk insights.

Photo was taken in the IBHS Research Center’s state-of-the-art wind tunnel. Pictured from left to right: Murray Morrison (Managing Director of Research, IBHS); Ian Giammanco (Senior Director of Product Design & Lead Meteorologist, IBHS); Faraz Hedayati (Research Engineer, IBHS); Roy Wright (President and Chief Executive Officer, IBHS); Kumar Dhuvur (Product & Founder, Zesty.ai); Attila Toth (Chief Executive Officer, Zesty.ai). Click to enlarge.

Zesty.ai places its alliance with the IBHS in the context of increasing frequency and severity of natural catastrophes. According to the Swiss Re Institute, four out of the five years with the largest catastrophic losses ever recorded fell within the past ten years. For example, annual losses from severe convective storms have more than doubled to an average $15B in the U.S. over the past decade. Similarly, California alone has seen average annual losses from wildfires drastically increase to over $20B in both 2017 and 2018. Traditional understanding of natural disasters has primarily focused on climatology and meteorology. Research by IBHS into the resilience of construction materials like roof shingles, vents, solar panels, decking materials, and landscaping to wind, hail, fire, and other climate- driven damages is crucial in developing a more comprehensive understanding of climate risk. New insights, driven by scaling such understanding against Zesty.ai’s extensive historical loss data, will both inform future building testing and help facilitate the development and growth of AI-powered risk models for the insurance industry, the vendor says.

Zesty.ai, with offices in the San Francisco Bay Area and Montreal, Canada, uses artificial intelligence on unique data sources, such as aerial imagery, building permits and local weather stations to model the impact of natural disasters on real property.

Attila Toth, CEO, Zesty.ai.

“Having Zesty.ai as an associate member expands the roles that IBHS can play in the insurance industry,” comments Roy Wright, President and CEO, IBHS. “By merging our research with artificial intelligence, we’ll be collaborating on tools that help policyholders and the public identify, reduce, and manage risk. The majority of our members are property insurers who look to us for scientifically backed research and guidance to build stronger homes and businesses. Technology, such as artificial intelligence, is a crucial part of that equation.”

Resilience Research

IBHS studies and evaluates residential and commercial construction materials under realistic re- creations of hazards like severe weather and wildfire. The organization reports that studies into ember exposure, hailstorms, high wind, and rain have made a tangible impact on building standards and represent a wealth of important data.

“Our alliance with IBHS unlocks tremendous value for the property insurance industry,” comments Attila Toth, Founder & CEO of Zesty.ai. “By marrying cutting-edge building science from the lab with data science in the cloud we are creating next generation climate risk models that help insurance companies better protect the communities and businesses they serve.”

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Anthony R. O’Donnell // Anthony O'Donnell is Executive Editor of Insurance Innovation Reporter. For nearly two decades, he has been an observer and commentator on the use of information technology in the insurance industry, following industry trends and writing about the use of IT across all sectors of the insurance industry. He can be reached at AnthODonnell@IIReporter.com or (503) 936-2803.

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