IRDA Claim Settlement Ratio 2017-18 – Who is IN and Who is OUT of the best insurance company list?
IRDA has released its annual report for 2017-2018 last week, which contains Insurance Claim Settlement Ratio 2017-18. You might get doubt that in 2019 they are releasing 2017-2018 CSR details. IRDA analysis several details and publishes last year data after 9 months every year. One of the key parameters which one would use in choosing a best insurance plan is, Claim Settlement Ratio(CSR). LIC share is reduced in 2017-18 compared to previous years. Some of the insurance companies which was in top-10 Claim settlement ratio are down now. What are the highlights of the IRDA annual report of 2017-18 pertaining to claim settlement ratios? Which are the best insurance companies from the published list of IRDA claim settlement ratio of 2017-2018? How is your insurance company doing? How many applications your insurance company is rejecting? Every insured individual should read this article not just for gaining knowledge, but also to know what may happen in future for their family while claiming insurance in his/her absence.
What is Claim Settlement Ratio (CSR)?
If you are already familiar about this, you can skip this section.
The claim Settlement ratio is the ratio arrived by comparing the total claims paid over the total claims received by the insurance company. If an insurance company has received 100 claims during a year, but paid only 95 claims and rejected 5 claims, claim settlement ratio is 95%. Higher claim settlement ratio means, higher the acceptance by the insurance company for the claims. Hence, individuals would prefer high claim settlement ratio insurance companies so that their claim is not rejected in the future. This is one of the key parameters in choosing a good insurance plan.
Highlights of IRDA Claim Settlement Ratio 2017-18 – How is your insurance company doing?
I am producing some of the key highlights of the IRDA annual report about claim settlement ratios for 2017-18 pertaining to individual death claims.
1) The claim Settlement ratio of LIC is better than Private Life Insurance Companies even this year.
2) The LIC Claim Settlement Ratio has reduced from 98.31% (2016-17) to 98.04% (2017-18). Repudiation (Rejections) has marginally come down from 0.97% (2016-17) to 0.67% (2017-18). The difference between a claim paid and repudiation (rejections) are proposals pending.
3) Private Insurers Claim Settlement Ratio has gone up from 93.72% (2016-17) to 95.24% (2017-18). Repudiation has reduced from 4.85% (2015-16) to 3.97% (2017-18).
4) Overall industry claims settlement ratio marginally reduced from 97.74% (2016-17) to 97.68% (2017-18). Overall industry repudiation decreased from 1.45% (2016-17) to 1.1% (2017-18).
5) LIC Market shared reduced from 71.86% to 69.36% in terms of total premiums collected. Private Insurance company’s premiums are at 30.64% out of total premiums collected.
6) Top 10 high claim settlement ratio insurance companies for 2017-18 are listed below.
1) Max Life – 98.26%
2) LIC – 98.04%
3) Tata AIA – 98%
4) ICICI Life – 97.88%
5) HDFC Life – 97.8%
6) Bharti Axa Life – 96.85%
7) Exide Life – 96.81%
8) SBI Life – 96.76%
9) DHFL Pramerica Life – 96.62%
10) Birla Sunlife – 96.38%
Claim Settlement Ratio of all insurance companies are listed here
Other Highlights of IRDA Report of 2017-2018
1) There were 68 insurance companies operating in India by end of Mar-2017, out of which 24 are in life insurance business, 27 general insurance, 6 are standalone health insurance and 11 are reinsurance companies including foreign reinsurers including Lloyds India. In 68 insurance companies, 8 are public sector insurance companies and balance 60 are private insurance companies.
2) The life insurance industry recorded a premium income of Rs 458,809 crores during 2017-18 as against Rs 418,576 Crores in the previous financial year, registering growth of 9.64%.
3) Growth from Single Premium Plans have reduced now and limited to 11% this year compared to 32% growth last year. LIC gets 33% of its total premiums from these plans.
4) Surprisingly, Unit linked insurance products (ULIPs) registered a growth of 23% premium from Rs 52,845 crores in 2016-17 to Rs 64,851 Crores in 2017-18.
5) Out of 24 life insurers operated in 2017-2018, 19 reported profits for the year. They are Bajaj Allianz, Birla Sun Life, Canara HSBC Life, DHFL Pramerica, EXIDE Life, HDFC Standard, ICICI Prudential, IDBI Federal, India First Life, Kotak Mahindra, Max Life, PNB MetLife, Reliance Nippon Life, SBI Life, Sahara India Life, Shriram Life, Star Union Dia-ch life, Tata AIA and LIC of India. (Indicated in alphabetical order).
Which is the Best Insurance Company you can opt based on Claim Settlement Ratio(CSR)?
If you observe, there are several insurance companies where the claim settlement ratio was higher than 85% in earlier years, but now dropped. Fresh list of insurance companies coming in top 10. However, if you observe, only a few are still in the top list. Hence, considering a term insurance plan or life insurance product from top 4-5 list would be always better. Here are the top companies which are consistently having high claim settlement ratios.
Top#1 – MaxLife Insurance
Maxlife Insurance has been standing high in claim settlement ratios in the last few years. Some of its products like Max Life Online Term Plan have come popular. However, some of its products like premium return term plan are no so attractive plan.
Max Life Online Term Plan is a pure term insurance plan. This insurance plan protects against death of the policy holder. This plan is available in 3 options. Basic Cover, Life Cover with Monthly Income Plan and Life Cover with Increasing Monthly Income plan. Additional protection with comprehensive accident benefit riders. Low premiums for non-tobacco users. High Sum Assured have discount on premium. For a 30 year male, and Rs 1 Crore sum assured, the annual premium works to be Rs 8,378 (approx.) without any riders.
Last year, this was at a Top-4 position on term insurance plan recommendation provided by us.
Top#2 – Life Insurance Corporation (LIC)
There are several insurance products, however many still believe in taking a good term insurance plan and invest surplus in various investment options including mutual funds. One of the best plan from LIC is LIC’s e-Term Insurance plan. This is a pure term insurance plan. Minimum Sum Assured is Rs 25 Lakhs. Any individual who is in the 18 years to 60 years can consider this term insurance plan. Policy is available for 10 years to 35 years. Since LIC is having a high claim settlement ratio, its premiums too are very high. One should consider this aspect before opting for the term insurance plan from LIC. You can read the LIC e-Term Insurance Plan review here.
Last year, this was at Top-1 position in term insurance plan recommendation provided by us.
Top#3 – ICICI Life Insurance
ICIC Life insurance has consistently in the top 5 high claim settlement ratio companies in India. There are several insurance products from ICICI Life, however 2 have become famous, ICICI iprotect term insurance plan and heart and cancer care plan.
Any individual who is in the 18 years to 65 years can consider this term insurance plan. ICICI iProtect Smart Term Insurance plan offers death benefit, critical illness benefit and waiver of premium on disability. This term insurance plan covers 34 critical illnesses along with accidental benefit. If a 30 year individual opting for this plan for Rs 1 Crore sum assured for 30 years, the annual premium works out to be 8,279 (Approx).
ICICI Heart and Cancer Protection plan is a health insurance plan that offers protection from heart and cancer diseases too. An individual of 30 years can opt for Rs 20 Lakhs health insurance plan (Rs 10 Lakhs for heart and Rs 10 Lakhs for cancer) and premium works out to be Rs 2,200 per annum.
Top#4 – HDFC Life Insurance
HDFC Life too has been having high claim settlement and has been standing on the top-5 claim settlement companies. HDFC Life has launched several products, however, its term plans like HDFC Click 2 Protect Protect 3 D Plus Term Plan and retirement plan like Click 2 Retire have become famous owing to its good features.
HDFC click 2 Protect 3D Plus is a non-linked insurance plan which comes with several unique features. In this plan, 3D refers to the protection against 3 Ds of life, i.e. Death, Disease and Disability. So, it is basically a term insurance plan which has been decorated with disease and disability riders. A total of 9 options is available under this new plan. In case of Accidental Total Permanent Disability or on diagnosis of critical illness (available under few options), all the future premiums are waived. One can protect himself for the entire life with the lifelong protection option or 3D lifelong protection option. If a 30 year individual opting for Rs 50 Lakhs sum assured for 30 years tenure and opting for income option, the premium works out to be Rs 6,252 without additional riders.
HDFC Click 2 Retire is an online ULIP which comes with low ULIP charges, hence it has become a popular retirement product.
We have TATA AIA in top 5 positions this time compared to top-8 position in the last year. Hence we are not covering this as part of top-5 list as of now as one need to see consistency.
Conclusion: While Claim Settlement Ratio is not the only criteria, it is one of the key components in choosing a life insurance plan. Consider high claim settlement ratio insurance company when you choose a term insurance plan. One should note that we cannot do anything if claim settlement ratios are coming down from previous years (where you would have brought insurance plans earlier). However, I observed, LIC, ICICI Life, HDFC Life claim settlement ratios are always high and ranks in top-5. Hence, choosing a best term insurance plan or life insurance product from such high CSR companies would safe guard your family when you are really not there in this world.
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IRDA Claim Settlement Ratio 2017-18 – Who is IN and Who is OUT of best insurance company list