Berkshire Hathaway Insurer Uses AI Software to Determine Wildfire Fire Risk

(BRK.A), (BRK.B)

With devastation from wildfires growing every year, Berkshire Hathaway Homestate Companies is now using advanced software that analyzes a property that falls within a wildfire perimeter and predicts how likely is it to be destroyed.

A recent report from Aon found there were three separate wildfires in 2021 alone that generated economic losses beyond $1 billion, which outlines the growing importance of property-specific risk models for maintaining coverage in wildfire-prone states.

BHHC is using’s wildfire model (Z-FIRE™) that combines vital property details and actual loss data with machine learning to produce a predictive risk score.

BHHC has expanded their partnership with, extending the use of’s AI-powered wildfire risk model, Z-FIRE™, to 12 states.

Z-FIRE™ will be used to inform both underwriting and rating decisions, and the partnership expansion comes at a critical time for the insurance industry.

“Unfortunately, wildfires are impacting communities well beyond the western U.S., and managing that risk requires advanced models that help us truly understand wildfire risk at the individual-property level.’s model has outperformed our homegrown wildfire risk model,” said Brian Hall, Vice President – Products and Underwriting at Berkshire Hathaway Homestate Companies. “We started working with last year and saw an immediate opportunity to leverage granular wildfire insights that allow us to confidently write policies that commensurate with a property’s true risk.”

Z-FIRE™ not only provides regional and property-specific risk scores but also an explanation of the specific risk factors affecting the property. Using artificial intelligence that has been trained on more than 1,500 wildfire events across more than 20 years of historical loss data, it considers property-level features that influence risk.

Topography, historical climate data and critical factors extracted from high-resolution imagery such as building materials and surrounding vegetation in multiple defensible spaces are taken into account. This empowers insurers with a true property-level risk score that effectively splits risk, while providing the flexibility to recognize mitigation efforts by homeowners and their respective communities.

“The Berkshire Hathaway Homestate Companies have always been known for taking a progressive, innovative approach to risk management, and as wildfires continue to reach new geographies we commend them for being proactive with their approach to rating and underwriting around wildfire risk,” said Attila Toth, Founder & CEO of “The broad adoption of Z-FIRE™, which is now used in rating and underwriting across the entire Western US, is a critical piece of hardening the insurance industry and their customers to defend against climate risks.”

© 2022 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell a stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.