Evaluating Efficiency of Life Insurance Companies Utilizing DEA and Machine Learning

Data Envelopment Analysis (DEA), a non-parametric productivity analysis tool, has become an accepted approach for assessing efficiency in a wide range of fields. Despite of its extensive applications and merits, some features of DEA remain bothersome. DEA offers no guideline about to which direction relatively inefficient DMUs improve since a reference set of an inefficient DMU, several efficient DMUs, hardly provides a stepwise path for improving the efficiency of the inefficient DMU.In this paper, we aim to show that DEA can be used to evaluate the efficiency of life insurance companies while overcoming its limitation with the aids of machine learning methods.