Why Claim Settlement Ratio Should Be Your First Check Before Buying InsuranceThe claim settlement ratio (CSR) is a crucial metric that indicates the percentage of claims settled by an insurance company out of the total claims received. It serves as a key indicator of an insurer’s reliability and commitment to paying out claims. Before purchasing an insurance policy, it is essential to check the claim settlement ratio of the insurance company.A high claim settlement ratio signifies that the insurance company has a history of settling a large percentage of claims, thereby providing assurance to policyholders that their claims will be settled in case of an unforeseen event. On the other hand, a low claim settlement ratio raises concerns about the insurer’s willingness or ability to pay out claims.Checking the claim settlement ratio before buying insurance helps you make an informed decision. It allows you to assess the insurance company’s track record and gauge the likelihood of your claim being settled. By opting for an insurer with a high claim settlement ratio, you can ensure that you receive the compensation you are entitled to when you need it the most.Therefore, the claim settlement ratio should be your first check before buying insurance, as it reflects the insurer’s credibility and commitment to its policyholders. It is a vital factor that can significantly impact your decision-making process when selecting an insurance provider.

Navigating the world of insurance can be overwhelming, with numerous insurers in the market. One crucial metric to consider when choosing an insurer is the claim settlement ratio (CSR). The CSR is the percentage of claims an insurer settles in a given year compared to the total number of claims it receives. It serves as a key indicator of an insurer’s reliability and efficiency in honoring claims. The Insurance Regulatory and Development Authority of India (IRDAI) publishes the CSR annually, providing policy buyers with a transparent and data-backed way to assess the credibility of insurers.

A high CSR indicates that the insurer is dependable and prompt in claim settlements, minimizing the chances of distressing delays or rejections. A CSR of 95% or above is typically considered a sign of trustworthiness. The CSR is calculated using a formula that takes into account the number of claims settled and the total number of claims received. According to IRDAI’s latest data for 2023-24, Acko General Insurance and Navi General Insurance Ltd had the highest CSR among private general insurers, with 99.91% and 99.97% of claims settled within 3 months, respectively.

Among public sector insurers, The Oriental Insurance Co. Ltd had the lowest CSR at 65.08%. Overall, general insurers in India paid out 81.13% of total claims within 3 months of claim intimation. Stand-alone health insurers also had notable CSR performances, with Aditya Birla Health Insurance topping the list at 92.97%, followed by Care Health Insurance at 92.77% and Niva Bupa Health Insurance at 92.02%. The claim settlement ratio is a critical metric that can help policy buyers make informed decisions when choosing an insurer. It is essential to check the CSR before signing on the dotted line, as it is a direct measure of how likely an insurer is to stand by policyholders in their time of need.

The data shows that some insurers are more reliable than others in settling claims. For instance, Star Health and Allied Insurance Co. Ltd had the lowest CSR among stand-alone health insurers but settled the highest number of claims at 16,80,171. This highlights the importance of considering multiple factors when choosing an insurer. The CSR is not just a number; it is a reflection of an insurer’s commitment to honoring claims and providing timely financial support during emergencies. By considering the CSR, policy buyers can make more informed decisions and choose an insurer that is likely to meet their needs.