Revolutionizing Wildfire Insurance: A New Era of Protection
A Timely Debut
In the midst of a devastating winter, tech entrepreneur Dan Preston launched Stand, an innovative insurance startup focused on protecting properties in wildfire zones. The timing couldn’t have been more critical, as wildfires ravaged parts of Los Angeles, killing dozens and destroying thousands of structures.
A Decade of Innovation
Preston has been driving change in the insurance industry for over a decade. As the former technology chief and CEO of Metromile, he guided the company into the public market in 2020. After Metromile’s acquisition by Lemonade in 2022, Preston stayed on for another year before co-founding Stand.
A Risky Market
Stand is tackling a market that legacy insurers are rapidly abandoning due to the high risk. As of mid-2024, at least eight insurance carriers had left the state or limited their exposure. The California FAIR Plan, an insurer of last resort, has seen a 137% increase since 2019. According to LendingTree, about 10% of homes in Los Angeles are uninsured.
A New Approach
Through a combination of technology and a reimagined approach to home insurance, Stand aims to offer reasonably priced protection to homeowners in wildfire zones. By recognizing the need for property owners to make changes to their homes and surrounding land, Stand uses artificial intelligence and “physics-driven insights” to provide specific mitigation recommendations.
Growing Demand
With only a few properties insured so far, Stand is in talks with hundreds of potential customers. The demand is increasing dramatically as property owners understand the consequences of the LA fires. Preston believes that Stand has a responsibility to “level up” its ambitions and bring insurance back to the market.
Raising Awareness
Bill Clerico, Stand’s co-founder and initial investor, is using the disaster to raise awareness about wildfire mitigation strategies and available technologies. He emphasizes the importance of forest and fuel management, rapid detection, “hardening” of homes and communities, and reducing fires caused by utilities.
A Unique Opportunity
Clerico believes that Stand has a unique advantage in the market, as competition is dwindling rather than increasing. With existing insurers exiting the market, Stand can capitalize on its better-informed view of risk.
A Bigger Mission
While Stand is currently focused on high-value homes, Preston envisions a larger role for the company in promoting neighborhood resilience. By working with neighborhoods and city officials, Stand can help design communities to be more resistant to wildfires.
A New Era of Protection
As the insurance industry continues to evolve, Stand is poised to revolutionize the way we approach wildfire protection. With its innovative approach and commitment to making a meaningful contribution to the bigger problem, Stand is leading the charge towards a safer, more resilient future.
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