- Date : 15/11/2021
- Read: 3 mins
Picking the ideal life insurance company can be tricky. This article will guide you through the top 5 companies with the highest claim settlement ratio
The importance of life insurance cannot be overstated. If you want to safeguard your family’s future, you need to think about getting a life insurance policy. Life insurance is essentially a contract between you and your insurer, wherein you pay regular premiums. Then, in the unfortunate event of your demise, your beneficiaries will receive a lump sum payout.
The insurance amount will act as a welcome safety net for your beneficiaries, who won’t have to face any financial hardships after you are gone. But how should you go about selecting a life insurance company? Let’s talk about the claim settlement ratio, one of the most important criteria to pay heed to while picking a life insurance company.
Claim settlement ratio decoded
Claim settlement ratio is the percentage of claims that a life insurance company settles, compared to the total number of claims it receives. It is calculated as a percentage using the following formula.
Claim settlement ratio = (Number of claims settled ÷ Total number of claims received) x 100
Claims could get rejected for multiple reasons such as impersonation, misrepresentation, fraud, etc. So, you should be extremely careful while filling out your application.
Related: Death Claim: Is It Possible To Claim From More Than One Life Insurance Policy?
Why look for a high claim settlement ratio?
The claim settlement ratio of an insurance company shows the number of claims it accepts and rejects within a fiscal year. So, it is one of the best ways to rate an insurance provider. It is ideal to look for companies with a claim settlement ratio of over 95% since this indicates a higher chance that you will receive your claim without any hassle.
While the claim settlement ratio is often used to judge the quality of a life insurance company, it is not a good idea to base your decision solely on it. You should also consider other factors, such as plan coverage, service quality, policy benefits, etc.
Related: FAQs About Life Insurance Coverage During Pandemic Times
So which are the top 5 life insurance companies with the best claim settlement ratio for the FY 2019-2020?
Here are the top 5 life insurance companies in India that boast a claim settlement ratio of over 95%:
- MAX Life: Max Life comes first on our list with a claim settlement ratio of 99.22%.
- HDFC Life: HDFC has an impressive claim settlement ratio of 99.07%.
- Tata AIA: Following close behind, Tata AIA boasts of a claim settlement ratio of 99.06%.
- Pramerica Life Insurance: While Pramerica Life Insurance had a significantly lower number of cases than the other companies on this list, it returned a claim settlement ratio of 98.42%.
- Canara HSBC OBC: The last one on our list, Canara HSBC OBC has a claim settlement ratio of 98.12%.
Source: EconomicTimes.com
Last words
While the claim settlement ratio of a life insurance company allows you to gauge how many of its total claims a company settles, it should not be the only criteria for judging a provider. It could be possible that the company rejected claims because of genuine reasons.
Related: How To Choose The Right Insurance Company?
While selecting a life insurance provider, we recommend checking out their benefit amounts as well. It will help you make an informed decision.
The importance of life insurance cannot be overstated. If you want to safeguard your family’s future, you need to think about getting a life insurance policy. Life insurance is essentially a contract between you and your insurer, wherein you pay regular premiums. Then, in the unfortunate event of your demise, your beneficiaries will receive a lump sum payout.
The insurance amount will act as a welcome safety net for your beneficiaries, who won’t have to face any financial hardships after you are gone. But how should you go about selecting a life insurance company? Let’s talk about the claim settlement ratio, one of the most important criteria to pay heed to while picking a life insurance company.
Claim settlement ratio decoded
Claim settlement ratio is the percentage of claims that a life insurance company settles, compared to the total number of claims it receives. It is calculated as a percentage using the following formula.
Claim settlement ratio = (Number of claims settled ÷ Total number of claims received) x 100
Claims could get rejected for multiple reasons such as impersonation, misrepresentation, fraud, etc. So, you should be extremely careful while filling out your application.
Related: Death Claim: Is It Possible To Claim From More Than One Life Insurance Policy?
Why look for a high claim settlement ratio?
The claim settlement ratio of an insurance company shows the number of claims it accepts and rejects within a fiscal year. So, it is one of the best ways to rate an insurance provider. It is ideal to look for companies with a claim settlement ratio of over 95% since this indicates a higher chance that you will receive your claim without any hassle.
While the claim settlement ratio is often used to judge the quality of a life insurance company, it is not a good idea to base your decision solely on it. You should also consider other factors, such as plan coverage, service quality, policy benefits, etc.
Related: FAQs About Life Insurance Coverage During Pandemic Times
So which are the top 5 life insurance companies with the best claim settlement ratio for the FY 2019-2020?
Here are the top 5 life insurance companies in India that boast a claim settlement ratio of over 95%:
- MAX Life: Max Life comes first on our list with a claim settlement ratio of 99.22%.
- HDFC Life: HDFC has an impressive claim settlement ratio of 99.07%.
- Tata AIA: Following close behind, Tata AIA boasts of a claim settlement ratio of 99.06%.
- Pramerica Life Insurance: While Pramerica Life Insurance had a significantly lower number of cases than the other companies on this list, it returned a claim settlement ratio of 98.42%.
- Canara HSBC OBC: The last one on our list, Canara HSBC OBC has a claim settlement ratio of 98.12%.
Source: EconomicTimes.com
Last words
While the claim settlement ratio of a life insurance company allows you to gauge how many of its total claims a company settles, it should not be the only criteria for judging a provider. It could be possible that the company rejected claims because of genuine reasons.
Related: How To Choose The Right Insurance Company?
While selecting a life insurance provider, we recommend checking out their benefit amounts as well. It will help you make an informed decision.
