Banking
Deployment record
In the tracker →- Organisation
- Hippo
- System
- Clara
- Stage
- Live
- Function
- claims processing
- 01Hippo's AI claims agent, Clara, has a success rate of 90% on first notices of loss, enhancing claims processing efficiency.
- 02The company's expense ratio improved to 41.7% in Q3 2026, down from 52.0% a year earlier, attributed to operating leverage and AI initiatives.
- 03Gross written premium increased by 60% year-over-year to $498.1 million, while revenue rose by 29% to $156 million in Q3 2026.
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- 04Hippo announced a partnership with Greenlight Re to act as a preferred program carrier and provide claims administration and technology services to partners.
- 05The company raised its full-year 2026 guidance, expecting gross written premium of $1.70 billion to $1.75 billion and adjusted net income of $77 million to $80 million.
Hippo
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Hippo is using AI to take on more of the early work in its claims process. On the company's Q3 2026 earnings call on October 29, 2026, President and CEO Rick McCathron said Hippo's AI claims agent, Clara, is now showing a success rate on 9 of 10 first notices of loss, the initial report a policyholder files after damage or a loss.
McCathron said the technology "provides our claims operations the bandwidth to keep growing profitably." He did not describe how Clara works or give figures on claims staffing.
He also pointed to gains in how quickly Hippo can expand. Launching in a new state now requires 70% less engineering effort per state than Hippo's initial eight states, he said.
McCathron cited the rollout of Hippo's AI initiatives as one of the factors supporting the expansion of its homeowners business.
AI and the Expense Ratio
Hippo's expense ratio was 41.7% in the third quarter, down about 10 points from 52.0% a year earlier. Zeltser said the improvement came mostly from operating leverage as the company grew, along with the lower expense ratios of its casualty and commercial multi-peril lines. ]
He said Hippo's focus on operating leverage through AI allows it to grow the business while keeping fixed expenses largely flat. Gross written premium rose 60% in the quarter, while revenue rose about 29%.
McCathron said he expects the trend to continue. "We believe our investments in technology have us in the position to keep driving expense ratio down in the near future," he said. In closing remarks, he said Hippo is investing in technology and talent now to drive the company into 2028 and beyond.
Hippo did not disclose how much of the expense ratio improvement came from AI specifically.
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Offering Its Claims and Technology Stack to Partners
Hippo announced a partnership with Greenlight Re the night before the call. Under the arrangement, Hippo will act as a preferred program carrier for emerging managing general agents and will invest alongside Greenlight Re in those businesses. McCathron said the partnership will start small.
Beyond insurance capacity, Hippo plans to offer partner programs services including claims administration, customer support and technology, which it originally built to operate its own managing general agent, Hippo Home Insurance Program.
Asked by KBW analyst Thomas Mcjoynt-Griffith whether those services were a new revenue line, McCathron said Hippo is not treating them as a revenue center.
He said that on programs where Hippo takes a meaningful share of the risk, it would prefer to handle claims itself, because it believes its claims handling would surpass the quality of third-party administrators whose interests are not tied to underwriting profit.
He said the services would also let partners use the technology, data and AI capabilities Hippo has built over several years.
The Quarter
Hippo reported Q3 2026 gross written premium of $498.1 million, up 60% year over year, and revenue of $156 million, up 29%. Net income attributable to Hippo was $8.8 million, or $0.33 per diluted share, compared with $98.1 million a year earlier, when results included a one-time gain on the sale of a business.
Adjusted net income was $20 million, or $0.74 per diluted share. The net loss ratio rose to 56.7% from 47.6%, including a catastrophe loss ratio of 6.5%. The combined ratio improved to 98.4% from 99.6%.
Casualty premium grew 146% to $187.6 million, commercial multi-peril grew 63% to $107.8 million, homeowners grew 11% to $112.2 million, and renters grew 25% to $73.9 million. McCathron said Hippo is adding 14 states this year for quoting existing homes through national distribution partners.
Hippo raised its full-year 2026 guidance. It now expects gross written premium of $1.70 billion to $1.75 billion, revenue of $585 million to $590 million, a combined ratio of 97% to 98%, and adjusted net income of $77 million to $80 million. The company is targeting more than $2.5 billion in gross written premium and more than $140 million in adjusted net income by 2028.
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