ZestyAI Helps Insurers Get Ahead of Colorado’s New Wildfire Risk Rules

As wildfire risks continue to grow, insurers need innovative solutions to stay ahead. ZestyAI offers AI wildfire risk solutions that help insurers navigate and manage the increasing challenges posed by wildfires, particularly in Colorado, where new regulations are reshaping the landscape. These solutions provide data-driven insights, enabling insurers to make more informed decisions and better manage their wildfire risk exposure.

Recently signed into law, HB 1182 requires insurers to disclose how wildfire risk models impact rates, account for property- and community-level mitigation efforts, notify policyholders annually of their risk scores and available discounts, and provide a clear appeals process for disputed scores. The new regulations take effect July 1, 2026, across homeowners and condo policies, including admitted carriers and the FAIR Plan.

Carriers need to move early to ensure their risk models, rating plans, and customer communications meet the law’s requirements. ZestyAI’s explainable AI models are already in use by the Colorado FAIR Plan and leading carriers to assess mitigation and support policyholder communications in Colorado and other wildfire-prone states.

“As regulatory expectations around transparency and customer engagement continue to evolve, HB 1182 sets a clear framework for wildfire risk modeling,” said Bryan Rehor, Head of Regulatory Affairs at ZestyAI. “ZestyAI’s models were built with these principles in mind, offering carriers a proven, low-friction way to meet these requirements while delivering a better experience to policyholders.”

How ZestyAI Supports Compliance with HB 1182:

• Built for Transparency: ZestyAI’s explainable AI models allow carriers to clearly communicate how risk scores are generated, what factors are considered, and how mitigation actions influence risk.
• Mitigation-Ready Risk Modeling: Property- and community-level mitigation efforts are integrated into risk assessments, supporting discounts and appropriate pricing.
• Consumer Risk Score Disclosures: ZestyAI enables carriers to generate individual risk scores and mitigation factors for annual policyholder notifications.
• Appeals and Score Adjustments: Carriers can update risk scores in real time based on new property information, offering transparency and responsiveness to policyholders.
• Regulatory Alignment: ZestyAI’s wildfire, hail, wind, and severe storm models have been reviewed and approved for use in Colorado, helping carriers meet standards with confidence.
• Multi-State Scalability: Carriers can streamline compliance across Colorado and other regulatory environments using the same ZestyAI platform.

By adopting ZestyAI wildfire risk solutions, insurers can stay ahead of regulatory changes and significantly reduce their exposure to the growing threat of wildfires. ZestyAI maintains strong relationships with state insurance regulators and actively participates in dialogue around evolving requirements. At the national level, ZestyAI engages with organizations such as the NAIC and leading industry advocacy groups to stay ahead of broader regulatory trends. Through in-house Rating and Advisory organizations, ZestyAI files its models directly with state departments of insurance, ensuring each solution is rigorously vetted and aligned with jurisdiction-specific standards before reaching the market.