Predicting Life Insurance Policyholder Churn in Iran Using Machine Learning: A Transparent and Actionable Framework (مقاله علمی وزارت علوم)

چکیده

This study tackles the challenge of customer churn in life insurance, which leads to substantial financial losses. It introduces a transparent, reproducible, and leakage-free machine learning framework designed to identify at-risk policyholders accurately and efficiently. Using 20,000 anonymized Iranian life insurance policies with a churn rate of 26%, the study develops a complete modeling pipeline that includes imputation, standardization, and encoding steps performed strictly within the training process to prevent data leakage. Three model types, logistic regression, random forest, and XGBoost, were trained and evaluated using stratified cross-validation, F1-optimized thresholds, and performance metrics such as ROC-AUC, F1, and precision. Results show that all models perform similarly (ROC-AUC ≈ 0.70), with logistic regression achieving the highest F1 score (0.66) and XGBoost offering the best precision (0.68). The top-ranked predictions captured about 69% of churners, demonstrating strong operational potential. Policyholders with major payment delays were identified as the most churn-prone and easily detectable group. Overall, the findings confirm that transparent and interpretable machine learning models can effectively balance accuracy, simplicity, and practicality, supporting data-driven, value-focused customer retention strategies in the life insurance industry