Understanding claim settlement ratio for Indian insurance buyers
What's the story
One critical aspect many people neglect when purchasing insurance is the claim settlement ratio.
This figure can make or break your experience, and it's vital to select a provider that will be there for you when it matters most.
In layman's terms, it indicates the number of claims an insurer has fulfilled against the total they received.
Let's delve a bit further into what this entails for Indian insurance purchasers.
About
What is claim settlement ratio?
The claim settlement ratio, expressed as a percentage, indicates the number of claims an insurer settles in a financial year out of the total received.
For example, if an insurer receives 100 claims and settles 95, the ratio is 95%.
This ratio is crucial for policyholders, providing a measure of an insurer's dependability and efficiency in claim settlement.
Importance
Why it matters
For policyholders, a high claim settlement ratio means they can trust the insurer to approve and settle claims without unnecessary stress.
It indicates the insurer's dedication to keeping its promise of providing financial security during difficult times.
When evaluating different insurers, this ratio can be a crucial factor in determining which companies prioritize their customers' needs in claim settlement.
Locating information
How to find claim settlement ratios
The Insurance Regulatory and Development Authority of India (IRDAI) releases annual reports detailing the performance of insurance companies, including their claim settlement ratios.
These reports can be accessed on the official website of IRDAI and provide a complete picture of how various insurers fare in settling claims.
Plus, several financial advisory websites collate this information into more user-friendly formats for easy comparison.
Analysis
Making sense of numbers
A high claim settlement ratio indicates trustworthiness, but it shouldn't be the sole deciding factor.
Look at customer service, coverage options, premium costs, and exclusions.
Sometimes, insurers with lower ratios provide better overall value or specific benefits that match your requirements.
Assessing claim settlement ratios in conjunction with other considerations will help you make a well-informed insurance decision.