Kathmandu. Climate-related losses exceeded $100 billion in both 2023 and 2024. <\/p>\n
In a new report titled “Opportunities for private capital in AI-enabled climate and sustainability sectors,” Boston Consulting Group (BCG) said in May, the loss comes as the number of billion-dollar climate events has more than doubled since 2000. “Traditional disaster models rely on historical damage data and extensive geographic projections, which are becoming less effective at reflecting changing climate patterns,” the report said. \u2019<\/p>\n
According to the report, insurance companies are increasingly using AI-based systems that combine satellite imagery, sensor data and atmospheric models to generate asset level, forward-thinking risk assessments. “This allows insurers to assess risk at asset level, rather than using large geographic models,” the report said. \u2019<\/p>\n
BCG said the asset-level risk analysis has been identified as a niche insurance application. “In which AI is used to identify asset attributes and model the impact of potential risks as part of underwriting,” BCG said. <\/p>\n
According to BCG, one U.S. insurer increased its combined ratio by 4.4 percent in the first year after using Zesty AI’s platform. However, the company was not identified in the report. <\/p>\n
According to the report, improved risk visibility could help underwrite an additional 15 million to 20 million insurance policies in markets where risk data is limited. BCG estimates its AI-enabled asset-level risk analysis to be valued at approximately $30 billion, particularly in the property and casualty insurance sector. “Access and surplus line insurance companies and climate-specific carriers are users of these devices,” BCG said. \u2019<\/p>\n
Parametric insurance companies were also identified as using AI-driven climate risk models in underwriting. “Portfolio climate stress testing tools are also being used by insurance companies and financial institutions to identify and disclose long-term climate risks and support capital allocation,” BCG added. \u2019<\/p>\n
According to the report, AI-enabled climate risk modeling across all applications could provide about $75 billion in value annually by 2028. BCG said the reason for this adoption was to reduce losses, improve pricing accuracy and meet disclosure requirements. \u2013Agency<\/p>\n","protected":false},"excerpt":{"rendered":"
Kathmandu. Climate-related losses exceeded $100 billion in both 2023 and 2024. In a new report titled “Opportunities for private capital in AI-enabled climate and sustainability sectors,” Boston Consulting Group (BCG) said in May, the loss comes as the number of billion-dollar climate events has more than doubled since 2000. “Traditional disaster models rely on historical […]<\/p>\n","protected":false},"author":16,"featured_media":289524,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[45031,45044,45159],"tags":[],"class_list":["post-300723","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-banner-news-en","category-international-news-en","category-news-en"],"acf":[],"_links":{"self":[{"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/posts\/300723","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/users\/16"}],"replies":[{"embeddable":true,"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/comments?post=300723"}],"version-history":[{"count":1,"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/posts\/300723\/revisions"}],"predecessor-version":[{"id":300724,"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/posts\/300723\/revisions\/300724"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/media\/289524"}],"wp:attachment":[{"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/media?parent=300723"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/categories?post=300723"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/english.insurancekhabar.com\/ikbrapi\/wp\/v2\/tags?post=300723"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}