Profiles in Risk BONUS INTERVIEW – Shannon Shallcross of Pinpoint Predictive

Nick Lamparelli interviews Shannon Shallcross, Head of Client Services at Pinpoint Predictive about predictive modeling and its important function in the Florida Insurance marketplace

FULL TRANSCRIPT

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…Hi We’re back. We’re at the 2023 Florida

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Chamber annual insurance summit in…Disney World.

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Orlando, Florida. And who am I speaking with?

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I’m Shannon Shallcross I’m the head of client services from Pinpoint Predictive.

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And what does Pinpoint Predictive do? So Pinpoint Predictive is a predictive modeling company

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We do risk predictions for the insurance industry, and it’s not cat predictions it’s not cat

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modeling but what we’re really looking at is the individual behaviors of a person.

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Understanding that someone’s behavioral characteristics…has a bearing on if they’re gonna file

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a claim…if they’re gonna be involved in negation if they’re gonna cancel early.

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And it’s kind of a premise that is similar to the fact that credit is used in insurance so with

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credit…the the understanding there is you’re a good

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insurance risk if you have a high insurance based credit score.

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Similar premise for us that we’re looking at the behaviors of an individual but our process does

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not use credit at all Mhmm And our predictions are available at the earliest possible point So

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really before someone even fills out an application, You just have their name and address Don’t know anything else about them.

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You can pull a prediction to understand their risk propensity.

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Okay So don’t use credit score Correct Okay So…that’s unique.

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How is that possible? Magic. Imagine we’re we’re in Disney We’re in Disney world It’s very

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fitting…No Just kidding so The way that that’s possible is we’re using a different

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data source and it’s a data source that usually is not used by the insurance industry.

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It’s behavioral like omics data. And when you have enough

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of this type of data and I’m talking about trillions of data points Okay.

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And we have this on two fifty million US adults.

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there are a lot of things that you can do when you would apply deep learning machine learning in

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the modeling process And that’s what we do Yeah So that’s amazing So what would be I’m assuming

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social media, what what would be…No So no social media And the reason for that

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is when you do social media scraping, there is a potential that you’re adding bias into the

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modeling process and we have put in some pretty tight controls to make sure that we’re not doing

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that especially in light of some of the you know the NAIC had just really to bulletin on

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insurance companies’ use of artificial intelligence, we wanna control for bias.

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So we’re using data that is behavioral like an my data So it’s essentially what people are doing

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on screens what media they’re consuming, what are they buying.

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again they’re they’re data points that literally have nothing to do with what we’re predicting.

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But when you’re able to develop this behavioral fingerprint of a person Yeah In the model

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training process we can find out Okay.

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So this behavioral fingerprint looks a lot like someone who ends up becoming a…or it looks a

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lot like someone who is gonna file three claims in the first policy period.

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But on the opposite side of that coin and this is the part that is really important for carriers

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You can also identify who do we know is gonna be profitable at that really early point.

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So that’s very helpful to know because then you can understand when exactly you can quote and

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bind as quickly as possible Yes so it’s it’s that fast.

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So we’re talking potentially seconds to Subs tracking.

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Sub seconds to turn information around. Yes Yes.

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So we’re essentially…the integration is an API integration.

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So wherever a prediction is pulled, name and address, you get a prediction.

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Amazing. so why Florida? Why Why Florida Well why are you here?

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My question. Because of the magic…Well I I think I already know why Florida because you’re

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predicting claims but Yeah Let’s let’s specifically talk about like why Florida?

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Yes So a couple things about the Florida market are really important to our clients.

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number one, the citizens’ depopulation…has been

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something that’s been a really hot topic It’s a great opportunity for carriers here.

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But at the same time, the onus is on the carrier to really understand the nature of risk as

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they are evaluating…any new book of business to acquire It doesn’t even have to be related to

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that particular thing…but we are providing a prospective view of risk It’s not looking back

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It’s looking forward, and it works really well.

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The other one that we’ve had a lot of success with in Florida is a litigate prediction.

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Yeah Because litigation, I I know that reforms

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passed…last December, and those have been really great.

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But this has just been a constant issue for years and years and years in insurance where, there

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are loopholes…in the auto industry and the homeowners industry…And as soon as those

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loopholes are found, they turn into enormous problems for carriers.

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So it’s really helpful to be able to understand what’s the likelihood that this policy

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holder is gonna respond to a doorkeeper…that’s actually something that you can predict Yeah

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Yeah And and Steven Weinstein…who’s premier Permuting…reinsurance expert He was interviewed

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by AM Best recently and he was going he was talking about how this has been a problem forever

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Yes…In Florida’s like first it was, you know mold is gold.

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Right And then sync sync whole problems Like, so I was there for that.

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And so like that’s really interesting because I think in when I think when most most folks think

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of citizens takeout, they think of cat modeling…and trying to optimize the portfolio…

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Yes But this is like an additional layer on top around like okay…the problems that we’ve had

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in the last few years are not really cat…oriented They’re litigation oriented And you and you

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and that’s not gonna probably go away with the reforms They’ll just find some other…entrance

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Exactly…It’s about that people part of the risk And especially in Florida that people part of

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the risk, can turn into very high dollar claims if you aren’t able to get your answer out of it

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Yeah…so personal lines commercial lines, So we’re doing business in both personal lines and

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commercial lines personal lines primarily auto and homeowners insurance.

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For commercial lines…we do predictions for companies that have less than twenty employees

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because we found that using this process there’s a very strong signal with the business owner.

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So the behaviors of a business owner actually do play

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out in their loss experience and their loss trend.

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So commercial lines…we’re operating there as well workers comp Okay So I’ll tag…I’ll tag

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Pinpoint and yourself on this How how should people get in touch with Pinpoint or for yourself?

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They they can reach out to me happy to talk with them We have an awesome sales team too We have

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information on our website as well so really happy to have any discussions We work with carriers

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every single day on developing…strategies like this that help them to optimize all of their process.

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Okay So we we are in Disney World. So…who is your favorite Disney character…Oh

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boy This is not something that I We can include Pixar…You know, this

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you’re gonna laugh but I have to say the little mermaid, and this is a throwback to when that

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movie first came out, my younger sister it was her favorite movie.

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And my fun fact is I know every single line

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to that movie, every single song that’s in that movie.

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Because she probably watched it at least two hundred times when I was growing up Yeah So old school…here.

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So Pinpoint Predictive is using new technology, but it’s being sold by old school.

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Yep. Yeah K Shannon thank you Thank you.

About Nick Lamparelli

Nick Lamparelli is a 20+ year veteran of the insurance wars. He has a unique vantage point on the insurance industry. From selling home & auto insurance, helping companies with commercial insurance, to being an underwriter with an excess & surplus lines wholesaler to catastrophe modeling Nick has wide experience in the industry. Over past 10 years, Nick has been focused on the insurance analytics of natural catastrophes and big data. Nick serves as our Chief Evangelist.

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