Moody’s agrees to acquire Cape Analytics, which develops geospatial AI for insurance providers

Financial services company Moody’s announced on Monday that she agreed to acquire Cape Analyticsgeospatial artificial intelligence startup, for an undisclosed sum.

The deal, which is expected to close in the first quarter, subject to customary closing conditions, will give Moody’s access to Cape’s geospatial AI analytics technology for underwriting. With this technology, Moody’s plans to create a property database that will provide its insurance clients with “address-specific” risk insights, Moody’s CEO Rob Fauber said.

“By combining our … risk models with Cape’s AI-powered asset risk intelligence, we will provide our clients with the most advanced asset risk analytics available in the industry,” Fauber said in a statement, “enhancing insights and decision-making across insurance. life cycle.”

Cape’s departure comes at a time when the insurance industry is accelerating its adoption of AI and predictive analytics technologies. And in 2024 poll Conning, an insurance asset manager, found that 77% of insurers are at some stage of implementing artificial intelligence, an increase of 16 percentage points over the previous year. One each assessmentthe global artificial intelligence in insurance market will be worth $79.86 billion by 2032.

Suat Gedikli and Ryan Kottenstette founded Mountain View, California-based Cape in 2014. Kottenstette was previously a senior engineer at BMW, then a director at Khosla, while Gedikli was a research engineer at robotics incubator Willow Garage.

Cape allows insurance carriers to optimize their underwriting process by helping them use AI and geospatial imagery to evaluate properties without sending someone to physically inspect them. Through partnerships with geospatial imagery providers, Cape acquires satellite imagery, then applies in-house algorithms to extract structured data, such as whether a property has solar panels and the condition of the roof, and transforms it into a structured real estate database.

Kottenstette claims that almost half of the top property insurers, as well as some of the world’s leading banks, use Cape to inform their pricing and underwriting strategies.

Cape managed to raise $75 million in venture capital from investors including Formation 8, Pivot Investment Partners and State Farm Ventures before its exit, and according to Kottenstette, the company is cash-flow positive and profitable.

Kottenstette said he believes Moody’s, combined with Cape, can bring a “much deeper set” of solutions to carrier business flows and “provide a much more complete view” of risk. Moody’s clients can expect more detailed property data, Kottenstette added, including building characteristics, average annual loss estimates, valuations and more.

“Moody’s approach to broader, more diverse information gives us the ability to further expand and deepen Cape’s solutions by incorporating additional, orthogonal risk-relevant inputs,” Kottenstette said in blog post. “Moody’s on a global level could accelerate our expansion into the international market, [and its] footprint with financial stakeholders beyond insurance carriers can accelerate the adoption of Cape’s offerings within the mortgage ecosystem and those of other financial stakeholders.”

Cape is Moody’s first acquisition of 2025 — and its 23rd acquisition to date, according to to the Tracxn funding database. Cape adds to Moody’s other mergers and acquisitions related to property insurance, including Praedicat, a provider of casualty insurance analytics, and RMS, a climate and natural catastrophe risk modeling firm.