The Use of Rough Set Theory in Determining the Preferences of the Customers of an Insurance Agency

Abstract

In today’s market environment a fierce competition is being experienced. It can be clearly stated that the businesses that determine the customer profiles well and manufacture related products in accordance with the requests/needs of the customers gain superiority over their rivals. Within this scope, this fact is also an important issue for the companies that are trying to keep up with other competitors in the insurance sector. In this study, this critical problem of EPD which is an agency of Allianz Insurance was solved by using Rough Set Theory (RST) method. Ten condition attributes (i.e. age, gender, etc.) were examined in the study. Decision attribute is the variable of the insurance type which includes individual retirement, health and life insurances. With the method of RST, a set of rules were identified which may help in developing strategies that will bring in new customers to EPD while keeping present ones. The attained results were presented to the executives of EPD. The executives have re-determined their marketing strategies in compliance with these results and exercised these strategies accordingly. Feedbacks from the executives indicated that the RST helps in facilitating the development of marketing strategies based on the characteristics of the customers and determining their profiles. Keywords: Rough set theory, customer’s profile, insurance, decision rule