As natural disasters like wildfires, hurricanes, and floods become more frequent and severe, insurers are becoming inundated with a rising number of claims, making it harder to assess market and price risks accurately. Many insurers are withdrawing from high-risk regions altogether, leaving millions of homeowners and businesses without coverage.
Solving this problem is risk & insurance analyst Andrei Craciunescu, founding CEO of RiskCube, an AI brokerage platform that helps brokers secure coverage for businesses in high-risk areas.
RiskCube leverages artificial intelligence and real-time data tracking to connect brokers with insurers, automate risk assessment, and analyze economic and environmental factors—ultimately accelerating deal flow, reducing placement timelines, and driving higher profitability for brokers.
Learn how RiskCube Founder Andrei Craciunescu is helping to stabilize the insurance market in the face of escalating climate risks.
How Natural Disaster Risk Impacts Insurance
Insurers are increasingly relying on climate risk models and data-driven analytics to assess property risk. The unprecedented impacts of climate change, however, have made traditional risk calculation models unreliable in many regions, requiring a new approach to risk assessment and pricing. Factors like rising sea levels, unpredictable weather patterns, and extreme natural disasters can abruptly destabilize otherwise safe regions, rendering properties uninsurable overnight and forcing brokers to scramble for alternative coverage.
"Over the past few years, the severity of natural disasters has escalated," observes Andrei Craciunescu, CEO of RiskCube. "We're seeing hurricanes with higher wind speeds and increased flooding, as well as more prolonged wildfire seasons. Yet, there are still inadequate protocols to predict and mitigate these evolving risks."
The growing financial exposure of insurers to climate risks is reshaping the insurance landscape. In 2023, over 35% of insurers' investment assets (including stocks, corporate debt, mortgages, and real estate) were classified as "climate-relevant." Consequently, insurers have become far less willing to provide coverage in high-risk areas, leading them to increase premiums suddenly or withdraw entirely from high-risk regions.
Realizing the precarious situation this instability was causing, Andrei set out to build a platform that could help brokers and independent insurance agents better provide coverage for businesses facing extreme conditions.
RiskCube: Expanding Coverage with AI
In 2024, Andrei developed RiskCube, an AI brokerage platform that improves risk assessment protocols. It works by creating an accurate assessment of a business's risk, helping brokers get the appropriate insurance, and advising on mitigation steps to protect the property.
After the risk assessment is created, RiskCube automates procurement by letting brokers enter all relevant details in one platform and then sending applications en masse. This is in contrast to traditional brokerage platforms, where brokers must manually collect client information and contact insurers one by one.
If insurers decline to offer coverage, RiskCube connects brokers with alternative risk transfer strategies outside of traditional insurance markets. This includes solutions like parametric insurance, which triggers automatic payouts when specific events occur. Weather derivatives, another example of parametric insurance, compensate businesses like farms or electric companies based on certain weather conditions—even if there's no direct damage.
RiskCube leverages a combination of public and proprietary data sources, including NOAA climate data, USDA agricultural data, and Copernicus satellite imagery. For example, if an area previously considered low-risk starts showing signs of increasing flood threats, the shift is immediately flagged and affects all risk calculations for the region. In doing so, RiskCube can better advise users—whether that means adjusting existing coverage or helping brokers advise a business against building a production site on risky grounds.
"Instead of a reactive, once-a-year process that leaves room for unexpected risks," he explains, "this approach turns insurance into a proactive, real-time system that continuously accounts for emerging threats, helping property owners and businesses stay ahead of future financial losses."
Adapting Insurance to a Changing Climate
Since its launch in late 2024, RiskCube has been helping brokers expand insurance options for their clients. It's now Y Combinator-backed and poised to help millions of businesses better protect their assets.
By harnessing AI to provide better insurance solutions, automate tedious tasks, and incorporate data-driven climate and financial projections, Andrei Craciunescu's RiskCube empowers brokers to secure coverage where traditional policies have disappeared. In doing so, it helps business owners safeguard their investments in an increasingly unpredictable climate.
Check out RiskCube and see how it's helping brokers and independent insurance agents adapt to an uncertain future.
