Taking a Stand: Rethinking Residential Insurance in the Wake of Climate Change

A rapid increase in the frequency and severity of natural disasters has had a tectonic impact on the property insurance industry in recent years. Compared with a historical annual average of just eight and one half major floods, wildfires, earthquakes, and wind storms per year, the United States has seen more than 20 such events per year over the past half-decade. And 2024 marked the new annual record of 24 major climate disasters, from Hurricane Milton’s $50 billion dollars in property losses in Florida to nearly 8,000 wildfires in California, which collectively burned over one million acres.

Global losses due to natural calamities have risen to an estimated $133 billion dollars per year. This has caused homeowner insurers to lose money in 18 states, while others have abandoned vulnerable markets altogether. The trend has had a knock-on effect on residential homeowners, many of whom can no longer afford home insurance, if any is available to purchase at all. In total, some $22 trillion dollars worth of property is at severe or extreme risk in the United States, leading us toward what Dave Jones, the former insurance commissioner of California, calls “an uninsurable future.”

Rather than abandoning homeowners, the insurance industry urgently needs to adapt to the reality of climate change by rethinking insurance for this new era. And one company has done just that. They are called Stand, and I am pleased to announce that they are the latest member of the Neotribe family.

Stand takes a scientifically customized approach to home protection. It combines expertise in fire, fuel, land, and structures with AI-driven physics models and digital twin technology used in the aviation and aerospace industries, to identify specific, precise improvements that property owners can make to safeguard their homes.

For example, replacing mulch with gravel in a critical area, replacing a highly flammable juniper tree with more resilient maple, or installing sprinkler systems and fire-retardant materials can reduce a property’s risk of damage. And by using ground-up physics models, Stand can evaluate the impact of these mitigations without waiting for evidence over the years. That enables Stand to translate quantified risk reductions into accurate pricing, and ultimately to offer policies in areas others can’t or won’t. This is a win for both homeowners and the company.

Stand is now insuring climate-impacted properties, starting in California, where insurers have been actively non-renewing customers. Backed by the world’s most sophisticated reinsurers and an AM Best A-rating, Stand can insure well over $2b worth of homes in their first year.Stand’s founding team is stacked with entrepreneurial insurance and property veterans, including: Dan Preston, who previously led the automobile insurtech firm Metromile to an IPO in 2021 and acquisition by Lemonade a year later; Jason Mueller, former Chief Product Officer of PolicyGenius, a marketplace for millions of property & casualty products; Bill Clerico, founder of Convective Capital, a leading wildfire technology venture fund and former co-founder of WePay (acquired by JPM), and Sam Shank, co-founder and CEO of HotelTonight (acquired by Airbnb). 

I've been a relentless supporter of Dan Preston since the early days of Metromile and Jason Mueller, all the way back to 2009 when NEA invested in his company MyFit. We enjoyed many invigorating late-night whiteboarding and strategy sessions (and with Jason in particular, we had good times making it through the reserves of my spirit cabinet!) I'm thrilled to join them again in their new journey with Stand, along with the brilliant Bill Clerico and Sam Shank, as their team reimagines the property insurance space with the same intensity and drive that Metromile disrupted car insurance.

Please join me in welcoming Stand to the Neotribe family.