AI Case Study

Admiral automobile insurance planned to offer discounts to drivers based on data in their Facebook profiles but were prevented by Facebook

Admiral insurance had planned to analyse drivers' Facebook data to offer discounts to those customers deemed less risky; Facebook intervened and prevented the project from going live as it was a violation of its terms of services.

Industry

Financial Services

Insurance

Project Overview

The project was initially described as being "aimed at first-time drivers or owners – although anyone with a licence can apply. The scheme is voluntary, and will only offer discounts rather than price increases, which could be worth up to £350 a year. However, Admiral has not ruled out expanding firstcarquote. Admiral Insurance will analyse the Facebook accounts of first-time car owners to look for personality traits that are linked to safe driving. For example, individuals who are identified as conscientious and well-organised will score well. The insurer will examine posts and likes by the Facebook user, although not photos, looking for habits that research shows are linked to these traits. These include writing in short concrete sentences, using lists, and arranging to meet friends at a set time and place, rather than just “tonight”. In contrast, evidence that the Facebook user might be overconfident – such as the use of exclamation marks and the frequent use of “always” or “never” rather than “maybe” – will count against them."

Reported Results

Project never implemented: "Admiral has been forced to scrap plans to use Facebook posts to analyse the personalities of car owners and set the price of their insurance after the social media company said the scheme breached its privacy rules. In an embarrassing U-turn, the insurance firm pulled the product less than two hours before it was due to officially launch on Wednesday. Section 3.15 of Facebook’s platform policy states that the site’s data should not be used to “make decisions about eligibility, including whether to approve or reject an application or how much interest to charge on a loan”.

Technology

An in-house algorithm "looked for correlations between social media data and actual claims data. The technology will evolve as first car quote attracts customers and gathers more evidence about the correlations, meaning the importance of items identified on social media could change".

Function

Marketing

Customer Management

Background

"The rapid growth of social media and personal technology has given insurance companies and employers swaths of data they can access to analyse customers or employees. The initiative is called firstcarquote and was officially meant to launch this week but that was delayed at the last minute on Tuesday night. Admiral says that firstcarquote offers a way for young drivers to identify themselves as safe rather than having to wait years while they build up a track record and a no claims bonus."

Benefits

Data

Facebook user profile data including text posts and "like" clicks. "Admiral would not have access to information about what its customers look at on Facebook or what their friends do. The company would only have access to the information gathered during the quote process and would have no ongoing access."