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BACKGROUND AND OBJECTIVES: The accurate and scientific assessment of the risk to issue an insurance policy is one of the most critical and important stages of risk assessment frameworks. This leads companies to identify high-risk customers and determine the policy rates in accordance with their risks, and as a result, the claims will be covered appropriately through the insurance premiums. In this paper, a new method is presented to define the concept of risk factor in more practical, flexible and accurate way. In this method, which is based on an unsupervised clustering algorithm, initially, every single factor is examined based on different ranges and their corresponding impact on customer loss levels. Then, considering their connection with the ranges of other factors in terms of creating similar levels of customer loss, they are combined to form a package. Thus, different packages are created, each of which is considered a risk factor and comprise the ranges of factors affecting different levels of loss. METHODS: The k-means clustering method was used to divide insurers into clusters with similar risks, which correspond to the risk packages associated with the customers’ risk level. The number of desired clusters should be determined in advance, which is the main challenge of using this algorithm. Two main approaches for validation, namely the silhouette score and the elbow method, were presented. FINDINGS: Based on the elbow plot and silhouette coefficient, as well as considering the practical and realistic evaluation needed by insurance companies, four clusters were obtained. Cluster 2 and 3 are similar and can be merged to form a cluster of medium risk level. Therefore, three clusters were considered the best outcome for categorizing insurance policyholders. CONCLUSION: The risk packages can be introduced from the examination of the 3 clusters including People with high, medium and low age (confidence interval) with low price car whose gender is male can be introduced as the highest level of risk; People with medium and high ages (confidence interval) with medium and high car prices can be considered as medium risks, and Middle-aged and older people (confidence interval) with expensive cars were considered the lowest level of risk. From the results of these risk packages, it can be concluded that although a significant population of older policyholders falls into the first package (first cluster), they have the highest level of risk. On the other hand, the older people in the third package (even though their average age is the highest among the clusters) have the lowest level of risk. Another important point is that the risk level decreases as income increases simultaneously with age. [ABSTRACT FROM AUTHOR]