Allstate's Claim Prediction Challenge Nets Insights

Crowdsourcing competition yields predictive modeling on injury claims based on vehicle characteristics.

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Insurance Networking News, October 26, 2011, Pat Speer

The quest for predictive modeling insights has proved a boon for Allstate, as it releases the results of its three-month long crowdsourcing competition, which set out to find the best models predicting bodily injury claims based on vehicle characteristics.

Allstate launched the "Claim Prediction Challenge" on Kaggle on July 13, offering $10,000 to number crunchers worldwide. Even as of October 12, contestants continued to submit algorithms down to the competition's closing minutes.

From 1290 total submissions and 202 players, three data scientists rose to the top of the predictive modeling competition:

• 1st place - $6,000 - Matthew Carle - Sydney, Australia
• 2nd place - $3,000 - Owen Zhang - Bolton, Conn., USA
• 3rd place - $1,000 - Jason Tigg - London, United Kingdom

The three winners said the competition was about more than monetary rewards; they entered to size up their skills against some of the best predictive modeling talents in the world. The public leader board on the competition site fueled continual model improvements and additional entries.

"As an actuary, I have worked on claims models in the past, and the Claim Prediction Challenge allowed me to see how my modeling skills compare with those of other modeling experts," said Carle. "It also provided a way to improve modeling skills and try new techniques."

Allstate says it provided data from 2005 to 2007 to contestants, who analyzed correlations between vehicle characteristics and bodily injury claims payments to predict claims payment amounts in 2009. Using the data provided, modelers evaluated how factors such as horsepower, length and number of cylinders affect an insured's likelihood of being held responsible for injuring someone in a car accident. Allstate confirmed that the data provided to contestants contained no personal information about any individual consumers.

Allstate plans to examine the winning modelers' methods for possible use with its existing best-in-class modeling techniques, the insurer said.

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