Zohreen Shah and her husband, Rishi, spent only one night in the Pacific Palisades “dream home” they had worked a lifetime to afford before it was reduced to ash by the January 2025 wildfires that tore through Los Angeles.

“We started moving in last week,” Zohreen told People as fires still raged. “We spent one night there. Just one.” In total, the LA fires scorched over 57,000 acres, decimated more than 18,000 homes and buildings, and claimed at least 30 lives. Economic damages exceeded $275 billion, while insured losses topped $40 billion or more.

But amid the destruction, the fires also shed light on the shifting role of property insurers. Instead of just prepping for an avalanche of costly claims, AIG, USAA, Chubb, Farmers, PURE, and Travelers dispatched private firefighting services to defend insured homes—many of which were left unscathed even as neighboring properties were leveled.

These kinds of “wildfire defense services” are part of a growing focus on proactive risk mitigation that includes helping insureds harden their properties before disaster strikes—and sending in help when it does. Yet, while dramatic, these measures only hint at a more profound transformation taking place in the P&C insurance industry.

Not Just “Repair and Replace” Anymore

No longer content with just calculating risk and paying claims, a growing number of carriers want to predict and prevent loss altogether—and consumers are here for it. According to a May 2025 survey from Guidewire, 70% of European consumers, for instance, want carriers to provide proactive services such as warnings about issues and damage prevention, rather than just covering losses. With $170 billion in premiums at stake as policyholders increasingly seek more value from insurers, now is an excellent time to explore three essential pillars for successfully transitioning from “repair and replace” to “predict and prevent” operating models.

Intelligent Infrastructure: The AI That Powers Prevention

AI is foundational to next-generation, predict-and-prevent property insurance. When integrated into a modern, cloud-based infrastructure, generative AI-based risk assessment solutions like those from Insurtech Vanguards InsurPitch London winner nettle, and numerous Guidewire Marketplace partners, for instance, mine vast internal and external datasets to help underwriters understand and accurately price risk.

Generative AI models can also identify high-risk patterns—such as vegetation overgrowth, yard debris, or hail-prone roofs—and then recommend policy adjustments, suggest new coverage options, or offer highly tailored risk mitigation measures to policyholders. GenAI can also analyze customer behavior, claims histories, economic trends, and data from solutions like HazardHub or Faura to predict risks and the likelihood of claims in milliseconds. In fact, when applied to predictive analytics and policy-generation workflows, Bain & Company estimates that GenAI can help an insurer increase revenues by 15% to 20% and reduce costs by 5% to 15%.

With new forms of agentic AI capable of performing tasks autonomously, carriers can automate all of this at scale across their entire book of business. Together, these technologies can form a kind of central nervous system for next-gen carriers. They can continuously assess data from satellite imagery, IoT-based smart-home sensors, weather feeds, and policy terms to alert property owners of early signs of wildfire ignition or roof deterioration that could make a property vulnerable to hail or water damage.

When you consider that systems leveraging these technologies grow smarter and more effective over time, it’s little wonder that 50% of insurers plan to adopt agentic AI this year. With every interaction, machine learning feedback loops refine these models, enhancing underwriting precision, and enabling a future where insurers prevent losses before they happen.

A Real-Time Data Stack That Sees Risk Coming

True prevention enabled with AI orchestration isn’t possible without the visibility afforded by the kind of real-time data I just mentioned. As of Q2 2025, over 61% of global P&C insurers have adopted IoT-enabled policies, enabling them to stream live data from homes, buildings, and critical infrastructure. Moisture sensors, structural vibration monitors, smoke detectors, and indoor air quality devices now feed directly into AI systems that can trigger mitigation efforts—often before a policyholder even knows something’s wrong.

Geospatial intelligence elevates this further. Integrated to Guidewire, for instance, aerial, satellite, and LiDAR data from providers like CAPE Analytics offer parcel-level visibility into roof condition, wildfire, hail, and wind exposure. Meanwhile, ICEYE can provide early warning about flood danger that can save lives and supercharge catastrophe response. Nearmap’s solution estimates roof age within a range of +/-5 to 15 years, enabling carriers to detect mispriced risks, trigger midterm endorsements, or proactively reach out to policyholders.

Meanwhile, new forms of parametric insurance are further redefining proactive disaster response and helping to insure properties that might otherwise be uninsurable. Case in point: a novel pilot policy by the Nature Conservancy and UC Berkeley. Instead of insuring individual homes, they insure 1,345 acres of shared forest land for the Tahoe Donner Homeowners’ Association in California.

If a wildfire crosses a pre-defined geofence, a claim is triggered and paid automatically—no adjuster, no paperwork. But payouts and premiums are linked to mitigation efforts, such as tree thinning and prescribed burns. Early results include a 39% premium cut and an 89% reduction in deductibles compared to standard policies.

In models like this, communities collectively reduce risk, and insurers reward them for proactive land management—preventing devastating and costly wildfires before they happen. By all signs, the market approves. Global parametric premiums are forecast to triple, increasing from $16 billion in 2024 to more than $51 billion by 2034.

Governance That Makes It All Actionable–And Trusted

Prediction without trust is meaningless. Just 20% of consumers trust carriers to use AI responsibly, a sharp drop from 29% in 2024, according to a recent AI sentiment survey. This erosion of confidence makes it clear that opaque algorithms and black-box models aren’t an option.

That’s why leading insurers are architecting AI systems with transparency and governance built in. Agentic platforms now routinely document decision paths, track data lineage, and generate natural-language explanations for every action taken or avoided. These aren’t just intelligent tools—they’re auditable assets, designed for clarity and regulatory compliance.

Data infrastructure is central to this trust framework. To that end, P&C insurers are investing in cloud-native platforms, data governance tools, and real-time analytics pipelines, according to a 2025 report from McKinsey. This isn’t just IT modernization, mind you. It’s table stakes for predictive, preventative insurance models, where every decision must be explainable, timely, and rooted in reliable data.

Get Started: Five Imperatives for Predict-and-Prevent Leaders

With these three pillars in place, property insurers are evolving into real-time resilience networks. They’re detecting threats before they surface. They’re creating coverage that adapts dynamically to conditions on the ground. And they’re shifting their focus from paying claims to preventing them. Here are five key steps to get started:

1. Embed AI in workflows: Start with underwriting, claims, fraud, and CX. Prioritize systems that learn.
2. Invest in real-time risk data: Combine high-def data sources with models that see around corners.
3. Scale parametric models: Use them to cover the “uncoverable,” pay fast—and incentivize mitigation.
4. Leverage platforms that integrate best-in-class tools: Free operations from legacy limitations.
5. Treat data as a strategic asset: Govern it well, explain it clearly, and evolve it continuously.

Here’s one last prediction for you: By 2030, all of this will be commonplace. Carriers won’t just price risk; they’ll shape it. Foresight will be foundational. Prevention will be expected. And those who begin building today won’t just predict and protect—they’ll lead. Something Zohreen Shah and countless other property owners facing the prospect of damaged or destroyed homes from a rising number of natural catastrophes can no doubt appreciate.