Paradigm Model of Factors Affecting the Surrender of Life Insurance in Iran

Surrender of life insurance is one of the issues in the insurance industry, which causes dissatisfaction of customers, their misadvertisement, disturbance of companies' investment plans, lowering the GDP of the country, etc. Since most research focused on considering life insurance surrender from an economic perspective, the main goal of this study was to provide a comprehensive explanation of the causes that would lead to the surrender of life insurance policies in Iran.

Therefore, the present study, using a qualitative method and using the grounded theory strategy (Strauss & Corbin's approach), has estimated the causal conditions, interactions and consequences of the surrender of life insurance by policyholders.

Research data was obtained through interviews with top-level staff and surrender officers of life insurance in insurance companies operating in Iran.

The results show that the causal conditions include dimensions related to the life insurance structure, intervening conditions including dimensions related to the insurer and the insured, and ground conditions including aspects related to the structure of the Iranian society, which would lead to life insurance surrender. With interactions including re-consultation and provision of facilities or lack of consultation, the consequences include cancelation of the surrender and the satisfaction and continuity of life insurance or surrender, dissatisfaction, loss of trust from the insurer and viral advertising against the insurer, respectively. In addition, certain conditions such as economic or political instability at macro level and the policyholder job status and her/ his income at micro level, as well as the substantial characteristics of life insurance such as complexity, being long-term and intangibility, affect life insurance surrender. Accordingly, it is suggested that the training of agents and other sales intermediaries and their ethical behavior be considered by insurers.