Abstract:
The objective of this study is to identify the risk factors those caused for
increasing the persistence of life insurance policy, based on one of the wellknown
insurance company in Matara. In this study, the life insurance
policies which were opened during the period of 1st of January 2010 and
31st of December 2011 are considered. The data set is formed of a sample
of 570 life insurance policies. Gender of the policy holder (male and
female), type of policy (with 14 categories) and mode of payment (single,
monthly, quarterly, half yearly, and annually) are considered as affecting
factors. The method of analysis is based on statistical approach, survival
analysis. Kaplan-Meier Estimator and Life Table Analysis are used as
survival techniques. According to the present study, persistence of life
insurance of females is likely to be higher than males. The policies those
have higher survival time have the less of surviving probability and hence
they have higher risk of lapsation. Some policies are identified as they have
higher persistence. Single mode of payment has the constant surviving rate
and policies paid half yearly, have the lowest survival rate while those paid
annually have the highest survival rate. The survival model provides much
more information to the management of the insurance company than what
the regression model can offer.
