As California faces increasing wildfire risks, one insurance company is stepping up to address the challenge. Delos Insurance is taking a unique approach by using advanced technology to assess fire risks in high-risk areas. While many insurers are pulling back from California’s fire-prone regions, Delos is forging ahead with a new model that combines environmental science and machine learning.
Delos has partnered with the Spatial Informatics Group, a research organization known for its extensive work with Cal Fire and the California Public Utilities Commission. This partnership gives Delos exclusive access to valuable data that helps them evaluate wildfire risks more accurately. Shanna McIntyre, Delos’s chief data officer, emphasizes that their model has been rigorously tested over the past seven years, successfully predicting the scale of major wildfires.
The company aims to stabilize insurance pricing in a volatile market. Many insurers have exited high-risk areas due to sharp price swings, but Delos is focused on maintaining consistent pricing year after year. As a non-admitted carrier, Delos is not subject to the same rate approval processes as traditional insurers, allowing for more flexibility in their pricing strategies. However, McIntyre insists that they remain engaged with regulators to ensure transparency and compliance.
Delos’s model also seeks to identify properties that traditional insurers might deem too risky. According to their analysis, 65% of homes labeled as high-risk by other carriers are actually insurable under Delos’s criteria. This approach could open doors for homeowners who have struggled to find coverage.
What sets Delos apart is their commitment to testing their model against real-world data rather than relying solely on theoretical predictions. They work closely with insurers and reinsurers to access loss data, ensuring their model reflects actual wildfire outcomes. This empirical approach has allowed them to accurately assess risks associated with significant fires in recent years, including those in Los Angeles.
McIntyre, who previously worked in aerospace engineering, sees parallels between her former field and the insurance industry. Both involve complex systems and are heavily regulated. As climate change continues to alter wildfire behavior, Delos believes it can play a vital role in providing coverage to underserved markets. So far, they have insured over 25,000 policyholders in California and are looking to expand their partnerships.
While it remains to be seen how this model will perform amid ongoing climate challenges and regulatory scrutiny, Delos Insurance offers a promising strategy for tackling California’s wildfire risk. Their innovative approach may provide a roadmap for the future of insurance in a changing environment.