Ordinal Logistic Regression
3 likes1,790 views
The document summarizes a study on applying ordinal logistic regression to analyze a proposed new integrated education plan takaful (Islamic insurance) product. The study used a questionnaire distributed to 410 respondents to collect data on demographics and preferences. Ordinal logistic regression and correlation analyses found high acceptance of the integrated plan among all income levels. The proposed plan combines multiple riders into one affordable plan.
Ordinal Logistic Regression
- 1. Ordinal Logistic Regression on New Integration Education Plan Takaful Asaad, Al-Ahmadgaid B. [email protected] alstat.blogspot.com MINDANAO STATE UNIVERSITY ILIGAN INSTITUTE OF TECHNOLOGY
- 2. Introduction Insurance is a form of risk management used to minimize loss or risk against the risk of a contingent, uncertain loss (1). In Islam, there is this called Takaful (Islamic Insurance). The central idea of Takaful (Islamic insurance) contract is that it is a financial transaction of a mutual co-operation between two parties to protect one of them from unexpected future material risk. 2 of 16
- 3. Introduction There are many Family Takaful Companies in Malaysia such as Syarikat Takaful Malaysia, Etiqa Takaful, Ikhlas and others. The businesses in takaful used the takaful operator as the administrator of the fund and manages the fund in trust on behalf of the participants, and the contract between the participants and the operator is governed under the contract of Mudharabah (profit-sharing) or Wakalah (agency). 3 of 16
- 4. Definition of Terms • Riders - A provision of an insurance policy that is purchased sepa- rately from the basic policy and that provides additional benefits at additional cost. Standard policies usually leave little room for modification or customization, beyond choosing deductibles and coverage amounts. (4) • Surrender Value - It is the amount the policyholder will get from the life insurance company if he decides to exit the policy before maturity. (5) • Maturity Value - The amount to be paid to the holder of a financial obligation at the obligation’s maturity. (6) 4 of 16
- 5. Proposed Model The proposed model of new product of education plan has to combine all the riders in one plan and the name be changed to Economic Education Plan Takaful. The rider should include health, accident, hospital costs, loss an effort to work, critical illnesses, education, death benefit, death coverage and also pension. Life insurance or family takaful is needed for everyone in the modern, so the product must affordable to every category of income earners. 5 of 16
- 6. Objectives of the Study This paper exposes the study of Wan Muhamad Amir W. Ahmad et al on the application of the Ordinary Logistic Regression Model for a New Intergration Education Plan Takaful. This paper aims to: • present the Ordinal Logistic Regression Analysis of the new propose model; • present the Correlation Analysis between items of the questionnaire used in the study; and • Investigate the association between the capabilities of buying takaful insurance with other related predictors. 6 of 16
- 7. Significance of the Study This paper will be useful to statisticians and researchers as it addresses issues such as the global concept and interpretation of ordinal logistic regression model, which were applied on the New Intergration Education Plan Takaful. 7 of 16
- 8. Scope and Limitation This paper is an expository that focuses on the analysis of Ordinary Logistic Regression Model applied in the New Integration Education Plan Takaful on the article by Wan Muhamad Amir W. Ahmad et al. There will be no programming or any statistical software to be used in this paper. The author will only based on the results of the articles published by Wan Muhamad Amir W. Ahmad et al. 8 of 16
- 9. Methodology The researcher used questionnaire, containing 10 questions which cover the age, status, level of education, types of jobs, monthly salary, the number of children in the household, the cost of the new product in education plan takaful, and etc. The required sample size was 385, but the researchers used 410 respondents. Reliability in the questionnaire studies were also tested repeatedly. In addition, the researchers used Ordinal Logistic Regression to investigate the association between the capabilities of buying takaful insurance with other related predictors. 9 of 16
- 10. Questionnaire Questionnaire answered by 410 respondents. 10 of 16
- 11. Results and Discussion The data were considered to be ordinal since some of the predictors are ordinal. Below is the Correlation Analysis between items of the questionnaire used. 11 of 16
- 12. Results and Discussion Ordinal Logistic Regression Analysis 12 of 16
- 13. Conclusion After interviewing the 400 respondents using the questionnaire, almost all the respondents agreed that the integration model of education plan takaful could attract all categories of income earners into buying it. The most attractive aspect about this model, the plan offers affordable price for all categories of income earners and it also includes almost complete riders. This research has proved that the new idea of integration model in education plan takaful has been accepted by all categories of income earners. 13 of 16
- 14. Recommendations This expository was only dependent on the results obtained by Wan Muhamad Amir W. Ahmad et al. Due to that, we recommend using software for confirmation of the computations, and any possible graphical illustration. 14 of 16
- 15. References • (1) Insurance. Wikipedia. Retrieved October 10, 2012, from: http://en.wikipedia.org/wiki/Insurance • (2) Ahmad , W.M.A. W. et al (2012). Ordinal Logistic Regression Model for a New Intergration Education Plan Takaful . European Journal of Scientific Research . Vol.71 No.1 (2012), pp. 109-116 • (3) Rider. The Free Dictionary. Retrieved October 10, 2012, from: http://financial-dictionary.thefreedictionary.com/Rider • (4) Rider. Investopedia. Retrieved October 10, 2012, from: http://www.investopedia.com/terms/r/ rider.asp#axzz28tkck3kE 15 of 16
- 16. References • (5) ”What is Surrender Value?”. The Economic Times. Retrieved October 10, 2012, from: http://articles.economictimes.indiatimes.com/2009-12-09/ news/28435556_1_surrender-value-policy-premium • (6) Maturity Value. The Free Dictionary. Retreived October 10, 2012, from: http://financial-dictionary.thefreedictionary.com/ maturity+value 16 of 16