According to the Insurance Regulatory Authority of India (IRDAI), the claims settlement record of insurance companies improved in the Financial Year 2015. But what is Claims Settlement Ratio (CSR)? It is defined as the number of claims settled against the number of claims received. It is usually measured in terms of percentage. For the private sector as a whole, the claims settlement record rose to 89.40.
It’s no secret that the mis-selling of insurance products is a widespread problem in India.
While there is enough literature on factors to consider before buying a scheme – the sum insured, policy term, optional riders, etc., the Claims Settlement Ratio is not given due importance. In fact, the very purpose of insurance gets defeated if the claim is not paid.
Thereby, before buying insurance, you should consider those insurers, who holds a claim settlement of 85% or more. As customers, we are equally responsible to make the right choice.
Thesecond most important aspect is the duration of the settlement, i.e how fast you get the proceeds after making the claim. You should look at the percentage of claims settled within 30 days. A ratio of more than 80% is a good reference point to help you choose the insurer company.
Buying insurance is now simpler with the advent of online comparison platforms. But, the most critical step is to choose the product that fits your need. Price is an important parameter, but look at the price in conjunction with Claims Settlement Ratio.
Insurance from a company that avoids paying the claim is worse than having no insurance at all. So, before buying insurance, it is essential to have a clear idea about the claim settlement policies of the insurance company.
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