, Abbas Khandan,
Volume 14, Issue 51 (5-2023)
Abstract
Purpose: The aim of this study is to identify and classify insurance customers in order to identify the target population for increasing the profitability of insurance companies, achieving a balance in premium payments, and examining the health questionnaire as an indicator of policyholders' preferences. Moreover, designing a marketing strategy to optimize advertising efficiency.
Method: In this paper, five machine learning algorithms, namely Decision Tree, Random Forest, Support Vector Machine, Naive Bayes, and Logistic Regression, are used to classify customers into two categories: profit-generating and loss-generating. Data from a private insurance company is utilized, consisting of 2,897 observations collected from December 1400 to December 1401.
Findings: By utilizing machine learning methods and focusing on the target population, the chances of success can be increased. The presence of a small number of individuals who significantly reduce the profitability of insurance companies is evident. The pre-existing medical conditions of individuals have a considerable impact on their insurance usage and the damage caused to insurance companies.
Conclusion: Machine-learning methods can provide a comprehensive understanding of insurance customers and their needs. By identifying the target population, insurance companies can increase their profitability and satisfy their customers by addressing their specific demands
