Artificial Intelligence (AI) is all the rage these days, promising to revolutionize industries and transform how businesses operate. Since OpenAI released Chat GPT in November 2022, interest in companies using AI has exploded.

One sector where AI is making waves is finance. Companies are harnessing AI's power to reshape traditional finance and disrupt industries ranging from consumer finance to insurance. Upstart Holdings (NASDAQ: UPST) and Lemonade (NYSE: LMND) are all building and improving their AI algorithms to gain a competitive advantage. In this article, we'll explore how these companies leverage AI and whether it makes them solid additions to your portfolio.

Upstart Holdings is on a mission to fix the consumer lending business, which it says shuts out countless individuals because of inadequate risk models. The company argues that Fair Isaac's traditional FICO scoring system is inherently flawed because it only considers a few variables, making it harder for people to obtain personal loans.

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Source Fool.com