Improving Property Survivability with Homeowner Help

Pete Miller [00:38]: Welcome to Predict & Prevent!  Today we’re joined by Valkyrie Holmes, CEO of Faura.  Valkyrie went from working at NASA and SpaceX to tackling a huge problem: helping homeowners assess their ability to survive wildfires, hurricanes, floods, and earthquakes. 

Here’s what makes Faura different—instead of waiting for expensive inspections, homeowners can assess their own risk in minutes. Faura’s tech, trained on over a century of disaster data, shows exactly what puts homes at risk … and what actually makes them more resilient to damage. We’ll explore how insurance companies are using these insights to keep customers instead of dropping them, and how simple fixes can make all the difference.

Could a quick self-assessment and a $500 repair save your home from disaster? Let’s find out… 

Pete Miller [01:38]: Valkyrie, please tell us a little bit about your background and how you came to focus on both climate risk and found far.

Valkyrie Holmes [01:45]: Thanks so much for having me. My kind of like journey in tech started off when I was back in high school, focused largely on natural disaster risk. So I did a lot of programs, you know, grew up in Las Vegas, kind of surrounding moonshot technology outside of school. So how do we create technology that doesn’t exist now, but could exist in the next three to five years that solves some kind of problem?

Um, and natural disasters, specifically wildfire really fascinated me because when you initially look into it, you think that it’s all that it’s, that it’s fine. And, you know, this is like six or seven years ago now, but yeah, you think, okay, we have federal funding dedicated to this. have firefighters in every County. have all of these things. And then you start to peel back the layers and realize, Oh, we have lots of population density in areas that weren’t as dense before. And we have all of this buildup of brush. And we have, because we’re having all of these population spikes, we have to build very fast, typically out of cheaper materials. So it all kind of spirals together and you realize, okay, we actually have a pretty massive problem.

And it’s not just for wildfires, it’s for hurricanes and floods and everything that we kind of focus on now. But yeah, it got me interested in that. I spent a good amount of time in data science and engineering with the NASA SEES Institute. So I was working on satellite imaging there and then worked at SpaceX on their commercial rideshare team. So we were on the team that was focusing on getting companies into space aboard Falcon and what we needed to measure to do that. And then pivoted into more specifically climate, consumer engagement and insurance after getting a grant to do so for about two years.

So now, Faura has existed for like almost three years at this point and we’re in every state, we’re expanding the team. We’re 15 now. So it’s been pretty exciting, but I think insurance has a lot of really interesting applications. And as someone coming from outside of it, it also took a little bit of getting used to. So it’s very good.

Pete Miller [03:55]: It does take a little getting used to. So like if you were, know, what would you say the elevator pitch, if you will, for Faura’s approach to improve and resilience? And how are you, how do you differentiate yourselves from others in the market?

Valkyrie Holmes [04:10]: Yeah, definitely. So I typically like to say that we help carriers verify information about properties in higher risk areas in partnership with our policyholders. So I kind of break up Faura’s kind of like value added to two separate sections. One is the survivability of properties. So understanding which ones are more resilient than others and what makes up those components. And then on the consumer side, it’s really engaging people and improving retention to differentiate ourselves in the market.

So what I mean by that is when people are shopping for insurance, there’s a lot of emphasis on the marketing elements. And now, especially as we become more digitized, we want that customer experience, but it kind of gets lost in a lot of these elements of efficiency that we’re trying to drive, especially in something like underwriting. So we kind of approached it from this angle of, okay, people need to learn more about their properties.

Insurance companies benefit from not only getting data quicker and cheaper, but also the fact that customers are enjoying the experience and it makes it easier to stick with one carrier versus the next. And so how do we combine those two to give people more education about their policies and what makes up their property risk and also give that information and package it to insurance companies?

So that’s essentially what we do. And we do that for high risk properties all over the country through five different perils. So we do it for wildfire, hurricane, hail, flood, and earthquake. So a lot of like the more major disasters that are being influenced in underwriting, I would say.

And the workflow typically happens as, you know, I’m a policyholder. I’m typically a homeowner. I get a link that’s texted to me from my carrier that says, hey, this is carrier ABC. We need more information about your property. Click this link to complete a self-assessment. And from there, as a homeowner, I can confirm, OK, my insurance company thinks that I have a metal roof and masonry siding and no defensible space. Or maybe they think I have a wind graded garage door or storm shutters. And I can confirm or deny that and supply it with picture and video evidence, as well as other supplemental evidence that I am maybe investing in wind mitigation or I have specific things that may qualify me for discounts or incentives in my area.

So it’s kind of a lot, but at the end of the day, all of the things that we’re doing are really to improve policyholder member experience and then get better data, more data a lot quicker because we’re working in partnership with our consumers.

Pete Miller [06:54]: So Faura frames resilience kind of has survivability, right? So when we talk about improving resilience, I think we’re really talking about survivability. So can you tell us why this remains important, even if we have better advances in predicting severe weather events?

Valkyrie Holmes [07:13]: Yeah, so there’s a couple of things that are really interesting about this. I think the thing that I’ve always kind of led with is the idea that traditional climate models and identifying weather elements are very different than the survivability of a structure or parcel data that can influence the survivability of a structure. So we’ve kind of approached, we have our own survivability model that tries to quantify the resilience of every property in a portfolio.

And we do that by not focusing on where disaster is likely to happen. That’s the job of traditional climate modelers. We’re more focused on, OK, if a disaster does happen in this area, which properties are more prone to damage or are more vulnerable across this portfolio. And I think there’s a really interesting distinction there that separates resilience and survivability from just looking at extreme weather trends, because it does fill that gap.

I talk to a lot of companies about secondary modifiers and what elements are being used to drive different climate scores. You have the ABCD or percentage scores. And if we’re maybe not using as many secondary modifiers or we’re only basing it off of the primary elements of a home, the biggest things that are driving that are the weather data. But we can be driving a lot more insight from those secondary modifiers, especially in higher risk areas where it really matters what distinction is which.

And the second part of that is just the conversation around public data nowadays. So we have a lot of conversations, especially recently, around the fact that, hey, we have a lot of organizations that are currently being defunded. We have a lot of public data that’s already relatively outdated, but has already been, you know, we’re seeing the effects of a decrease in weather alerting systems and proactive mitigation alerting systems that only trickles down into the kinds of data that aggregators are using, that modelers are using, that insurance companies are using.

So it really brings it back to how do we understand from like an independent building level which properties are more survivable and then how do we work in tandem with the people that are living there all the time, it’s their most valuable asset, to just ask. I was on the phone with someone today. and it’s just, crazy that we that we’re insuring these people and we have maybe like one or two touch points over the life cycle of a client. And we don’t think to ask, like, is this correct? Are we off base or not? It’s interesting, but you know, that, that requires more customization, which I think Faura does, does a good job of honing it on.

Pete Miller [09:57]: So when you go to assess a property’s survivability and once you’ve identified the risks, then how do you go about improving that survivability?

Valkyrie Holmes [10:09]: Yeah, so there’s a couple of different things and obviously it’s going to depend on the disaster. Wildfire is probably the one that comes to mind the most. But we take a pretty hands-on approach and try to streamline it for the consumer as much as possible. So typically if a consumer is taking a Faura assessment that’s required from their insurance company, it takes the place of what would usually be an in-person inspection. So instead of an inspector getting sent out there, we have someone that walks around and they take photos and videos and confirm that information, like I said before. And at the end, they get their own report that breaks down their property into action items.

So if you’re a homeowner, you get recommendations that are everything from moving logs away from your house, you know, to enclosing your deck, to replacing parts of your roof. And it can go from things that are low to no cost and like extremely low effort, things we like to say, like things that you can get done on a Sunday afternoon versus things that you might need a contractor for. And we have contractors that are recommended in your area that can help you do these things. So from that sense, we’re trying to solve the problem of, here’s everything you need to know about your risk. Here’s everything that if you were to take action, you should prioritize based off cost and effort and how it would impact your score. And then from that, when you decide to do those things, here’s everything you could possibly need to take that next step. And I think it takes a lot of that initial like back and forth that, you know, would be standard and like a non-renewal communication within an insurance company to say, okay, why is my policy being non-renewed? Well, it’s because you have these things. What can I do about it?  We see that email communication back and forth all the time, but it kind of integrates all of it into that. And then once people do it, they just resubmit. Same link, they go back through, they give us photos and videos, and then it goes right back into the underwriter’s hands to approve it. And we complete that cycle, and we’ve been able to maintain that for hundreds of people over the last, you know, just like month or so.

We just had someone that wrote back on a story where they were not renewed by their carrier because they had like some pooling on their roof issues. Did the Faura assessment and realized they could do $500 worth of mitigation activity. And then they got their policy reinstated, even though everyone was telling them that they would have to replace their roof and do all of these like things that essentially would have made it easier to just switch carriers. Right? So, there’s like the return on investment, not only from like the policyholder standpoint where they’re doing this work and they’re benefiting from not having to switch and not having to pay more every year. But then also the carrier gets to retain that premium and it’s a better customer experience because now you have all the context you need.

Pete Miller [13:04]: So you started in data science, right? So data science lives on data. Do you have enough data to evaluate the effectiveness of your scoring and recommendations to go ahead and improve survivability?

Valkyrie Holmes [13:19]: Yeah, definitely. And we continue to improve that every single day. In our score, we trained off of the last 100 years of property data, pre and post loss, as well as other factors like the most common research. Every time some new research comes out about new roofing material or defensible space criteria or mitigation criteria, we’re integrating that into our assessments and testing them on thousands of addresses at a time. So not only are we kind of creating this zero to 100 scale that kind of tells us relatively where those properties are. But we’re using that in practice for filtering.

So now companies can use that from a risk selection perspective to say, hey, maybe I have 100 properties that are in these higher risk areas that are all extremely risky. Maybe they’re in that gray area of what we can and can’t ensure. If we layer a Faura score on top of that, that tells us a little bit more about the structure itself, then we cut down a lot of the time that initially it would take to really make that decision on an individual level. And then we track home improvement and how that affects the scores all the time.

So we’re already seeing early evidence from things like the Palisades fire. We did a bunch on Hurricane Milton and Helene. And even more recent fires, we’re starting to see a pretty big distinction between the scores that are in this kind of like upper threshold of like 75 and above versus the ones that don’t have that much mitigation. And that can be everything from the materials to the condition of the property to vegetation buildup. So yeah, and we have a bunch of research on our site that we publish all the time that kind of illustrate more about that as well.

Pete Miller [15:03]: So a lot of it is mitigation, right? Like we’ve talked about and that kind of thing and people work on incentives, right? So like for a rewards-based mitigation program, what role do you play in making that happen, or is that strictly between the insurer and their policyholder?

Valkyrie Holmes [15:19]: You know, from our standpoint, we approached insurance because it’s inherently a very unique financial incentive and mechanism that we can use to get people educated about their risk, because everyone relies on insurance in the Western world, right? It’s so deeply ingrained in our properties and how we think about buying property and keeping property that I think for a long time, we’ve tried to approach this resilience conversation from different silos without connecting multiple pieces.

So, you know, taking it back to this like reward-based program, if we’re getting people in the process of applying for insurance or as a part of their renewals to understand that, hey, if I do this work and I maintain it over time, I get this benefit from this insurance company that is so ingrained in what I need to do, we need insurance, then people start to associate, okay, I did this assessment. I know that there’s this bush that I should probably get rid of on my lawn. And maybe I’m not going to do it today, but every time I walk past it now, we’re like tracking this behavior. So for us, in terms of how it works with an insurance company, we try to customize everything pretty heavily to make it work for every company.

There’s some that already have discounts that they filed that we integrate into their assessments. So it’s all white labeled. And if people are doing mitigation work that are specific to those discounts and will qualify them for those others view it kind of as like almost a compliance module for different states. So in California, you have specific discounts that you have to account for. There’s this new Wildfire Risk Modeling Act in Colorado that we’re working with a couple of companies with that makes it so that they have to disclose wildfire scores and what people can do and open the appeal process.

So that’s a whole different conversation, but it’s all pretty customized so that whatever reward program the insurance company has or that we can set up within a company, we want it to be as low of a threshold as possible for the insurer and have us take care of a lot of that back and forth with the customer.

Pete Miller [17:35]: You have a lot of data points, right? And from a, I guess, from a statistics point of view, like as you capture these, have any surprised you at how well they predict survivability,  and or are you identifying risk data that perhaps previously was under recognized?

Valkyrie Holmes [17:58]: Just taking that second question, I am constantly shocked with the amount of information we can get in partnership with our policyholders that really lend a hand to like more smarter decisions, more efficient decisions. And a lot of that is just data that if we ask for it, we could get. It’s harder for us to understand things like ember-resistant screening on ventilation if you’re only viewing it from an aerial view, or just the fact that we don’t have as many wildfire inspectors to really be able to go out to every property that needs an inspection and get the data that we need. So in identifying this information, I think the scalability is really surprising and the fact that we can get more information about just consumer behavior and how that plays into mitigation and that really, really greatly affects resilience and just like understanding which people are more likely to do this work as well.

 I think the thing that’s like most surprising in terms of like how well these data points point to survivability is, you know, it’s obviously ventilation. I think having, you know, more wind mitigation from like a storm shutter and garage door perspective is always really interesting. Because outside looking in, you’re not thinking too much about how the garage door is impacting your property, but pretty consistently, if your garage door fails, it’s taking a huge chunk of the house with it. And wildfire, there’s so many little things that we don’t even really think about that, for example, people that have like rosemary plants and things that are more likely fire bombs on their property that are extremely flammable almost always. If an ember lands in in a flower garden that has some of these plants on them, then we’re likely going to see much more loss than anything else. And it’s in being able to recognize that. So yeah, I think I’m constantly surprised, but those are like a few examples at least.

Pete Miller [20:07]: I was looking at your website, has a lot of information for insurers and agents. So which group is typically your primary partner that brings you in to evaluate a portfolio or work with their customers?

Valkyrie Holmes [20:19]: So primarily we’re working with carriers, but we actually recently launched a broker platform to give more insights to people that are on the ground, on the front lines with these consumers, either before they bind a policy or in kind of like that renewal process and answering some of those questions. And from the carrier perspective, we’re not only on the consumer education end, but we’re also gathering anywhere from four to six times the amount of information you would typically get from a standard in-person inspection and tailoring that to, again, confirming this third-party information as well.

On the agent side, we realized pretty quickly that if homeowners are using these survivability metrics to understand their property and insurance carriers are starting to use them, then we have this big gap in between of brokers that could be doing more education on the front lines and also using more resilience information to see where they should actually incentivize people to do this work. Maybe that’s something they can help with on the client side of getting them prepared for wildfire season, for hurricane season. And from a pure business perspective, if you’re allowing an agent to pinpoint, OK these properties have a higher likelihood of survival and in a hard market, these are the ones that I should be pitching to these companies to be a more profitable property, then they have way more information in their back pocket that they can use in that negotiation.

So I think there’s a lot of different things there, but I think involving the broker, especially that broker-client relationship is so, important for a lot of these companies. I think it’s really important. So we’re excited about that new kind of arm of what we do with Faura.

Pete Miller [22:06]: You talked earlier a little bit about the difference in approach and inspections and things like that. And I noticed on your website there’s homeowner tools so they can self-inspect. So how has the adoption of those tools been?

Valkyrie Holmes [22:21]: I would say that’s probably the thing that we’re known for the most is this self-inspection side. And our philosophy has always been that education comes first and that will trickle down into behavior. So all of our tools are on our website for free for a policyholder to utilize and learn about. And then we have a ton of other insights that actually direct data to companies that we’re working with.

But we never want someone to be blindsided by the fact that, hey, my company is asking me for information. What do I get in return? Because I think that’s the struggle with a lot of digital inspection tools today. It’s the idea that, hey, we’re focusing on this partnership with you. And then you give us this information. And OK, we’re done. We don’t talk to you again for another year.

So it’s honestly been really, really successful in terms of adoption so far. And we get a few thousand people every week that visit the site and go on and look at the assessments and take them. And then I think from a property inspection lens, we’re getting more information because people don’t necessarily want inspectors going to their house and peeking in and trying to view things on their property when there’s no transparency.

There was a news article in a story that came out just the other day about a woman who was talking about an aerial shot or drone footage that an insurance company sent to look at her house and that they non-renew her policy. But everything that she was talking about was way more along the lines of, hey, yeah, I knew I wasn’t home because my car wasn’t in the driveway. So it wasn’t the fact that they were necessarily using that information, it was the fact that she had no idea that they were.

And we did a lot of testing early on to supply people with an aerial image of their home to basically assess from a privacy perspective, is this something that turns people away? And not a single person in all of our testing over the last three years has ever been in any way put off by the fact that we have identified their property with aerial imaging. In fact, it makes them way more likely to move past the assessment and answer more questions because we validated that, hey, this is what is being represented. Tell us if we’re right or wrong, and then we’ll reward you based off of the work that you’ve already done or maybe the work that you want to do now that you know what to do. So I think it’s pretty interesting what we can do digitally now. Yeah, and it’s just kind of passing that information through. I think people just want to know a little bit more about it.

Pete Miller [25:16]: You’ve obviously done a great job up into this point, but when you think about the future, can you share with us anything that you’re thinking about that’s next for Faura? And how about where do you see yourself going down the road and how would you see your company developing?

Valkyrie Holmes [25:34]: Yeah, I mean, at the end of the day, I think our goal is always just how do we, as cliche as it sounds, it’s how do we help as many people as we can understanding their resilience? So, you know, like our goal right now is getting to a million homeowners that we’ve assessed and that we’ve helped with their mitigation activity. And then from there, it’ll be 10 million. And then, you know, we just continue marking it from there.

But I think it’ll also be interesting to see kind of the shifting behavior and how insurance companies think about resilience and engaging their policyholders. I think we’re seeing, especially in the last few years, like if I was pitching a solution like this when I first started learning about wildfire risk, I think I would have gotten laughed off of every stage that I’ve ever presented on. Because I think a lot of it is like a nice to have, and we’ve always framed it as a nice to have.

But it wasn’t until we’ve experienced so many losses day in and day out, and I think this is like the fourth or fifth year, we’re over $100 billion in losses. Maybe it’s even more than that. I think it took a while for us to realize, climate change is happening, and it’s changing weather patterns. And because of that, maybe our traditional models need some tweaking. And then on top of that, how do we, like that’s going to take quite a bit of time, but on the front lines, do we differentiate ourselves in the market and get ready for the fact that in classic news, we are still experiencing an insurability and affordability crisis. I think, yeah, it’ll just be interesting. And I think we’re already seeing a lot of people prioritizing that because we know that it really does make a difference. So yeah, I’m just excited to hear more about it and just track it.

Pete Miller [27:30]: If there was one thing that you wanted people to know, what would it be?

Valkyrie Holmes [27:35]: I think the biggest thing is just, you know, like we’re, we want to make it as simple as possible for people to, to get these touch points from their, from their customers. Right? Like I, I think I have a lot of conversations around this topic and a lot of people will ask me or, or be concerned with the fact that we don’t have a lot of resources. We don’t have a lot of time or people dedicated to this kind of thing. The goal of Faura and I think what we excel at the most is creating these custom solutions for insurers that don’t have that.

We work with lot of mid-sized companies that don’t have the capital and intensive resources to go through all of this testing and extensive research on their customers. We’ve done that. We’ve done a lot of that up front. There’s a reason why it’s so customizable. And we know what works with consumers and what gets us more information, quicker, cheaper, all of those things. So that’s the biggest thing I want to emphasize is just that we’re up and running in less than a week. Like, the fastest we’ve done is like 13 hours, I think. And we want to make it as simple as possible. Consumer engagement should not be this crazy convoluted messaging that I think we’ve all kind of approached it to be, I think it can be much simpler than that, thanks to everything being more digital.

Pete Miller [29:04]: Well, thank you. I appreciate this. Thanks for your time.