“Partial surrenders” refers to an individual exercising the option to withdraw a portion of the value of a life insurance investment policy without full termination. This option is generally applicable for unit-linked and variable annuity business, and poses a risk to insurers. In this paper, we cover some approaches to help insurers use the best option, from a relatively simplified static partial surrender assumption, to dynamic partial surrenders, both on deterministic and stochastic bases. We discuss:  

• Potential drivers of partial surrenders in a life insurance policy 
• Options to model partial surrenders, particularly in response to the economic factors
• Modelling of dynamic partial surrenders