Predicting Customer Churn Using CLV in Insurance Industry

Today, increased level of customer awareness caused them to access to the other suppliers easily and they can get their services from the competitors with similar or even better quality and same price. Therefore, focusing on customers and preventing them to leave, has been the most important strategy for any company. Researches have shown that retaining former customers is cheaper than attracting new ones. In the proposed model in this article we first identified important factors causing customers in insurance industry, to have a specific behavior by using a k-means clustering algorithm, and then we tried to predict the future behavior of them by a logistic regression. Our model accuracy is 98%.