IRDA Claim Settlement Ratio 2012-2013-What it indicates?

IRDA recently (1st January 2014) released it’s Annual Report for 2012-13. This report indicates the overall Insurance Industry data. Here in this post I am only concentrating on IRDA Claim Settlement Ratio for 2012-13. This report is till 31st March 2013.

When anyone buying insurance product then their major concern is what was the claim settlement ratio of Insurance Company. It is just one indication about how the company is treating it’s customer. You must look into this data, because insurance is a long term contract between insurance company and insured. But do remember that this must not be the deciding factor while choosing your insurance plan.

In below report I tried to colour in three different categories. First colour (green) is for the companies whose claim settlement ratio stands more than 90%, second colour (yellow) for 90% to 80% and third colour (red) for companies whose claim settlement ratio stands below 80%.

I also tried to differentiate how fast they settled the claims. To identify this I divided the claims into three categories, first for less than 30 days, second for more than 31 to less than 90 days and finally claims settled after 90 days. This data indicates how fast is your insurance company when actually resolving the death claims.

Source: IRDA Annual Report 2012-13

Source: IRDA Annual Report 2012-13 (

Also interesting point to note that from above 24 Life Insurance Companies 17 companies reported profits for year 2012-13. They are Aviva Life, Bajaj Allianz, Birla Sunlife, Canara HSBC, HDFC Standard, ICICI Prudential, IDBI Federal, ING Vysya, Kotak Mahindra, Max Life, PNB Metlife, Reliance Life, Sahara India, SBI Life, Shriram Life, Tata AIA and LIC.

Hope above points will be useful for you in deciding your buying of life insurance product. But I am once again stressing that one must not solely depend on Life Insurance company’s claim settlement ratio while buying.

Share & Comment


  1. Raj says

    Dear basavraj,

    i really appreciate you to spread knowledge in investor and insurer .
    i also plant to take term plan of 50 lack and investment of 50K yearly
    for 20 to 30 year and mediclaimed also please suggest company for above these 3 and
    is there ok with other than LIC company’s for term plan and investment.

    Thanks in advance for your great Opinion.


  2. Vamsi says

    Hi Basavaraj

    I have very similar query posted by Sachin Samuel.

    Even PolicyBazar proposed me same combination , the confusion is about Settlement ration do we take a chance with less premium Term covers or is it better to go with HDFC/Max/LIC which have better settlement ratios.

    I am sure i have declared 100% facts.

    Whether settlement depends up on the company profile or the facts i have disclosed.
    Honestly i dont want to take a chance , but i want to believe some one i can rely.
    What is your suggestion ?

    Thanks for the work

    • says

      Vamsi-Never believe on Policybazaar, even though they are claiming just comparative site, but still they lure buyers to buy particular company online term plans. Without having any benefit why they will force you by calling so many times to buy ONLINE TERM PLANS? So what it indicates is, don’t go only based on price of policy. Instead go with the company track record and how they are efficient in handling claims etc. It is purely the judgement of claim settlement team to decide based on the facts you disclose and the reasons for death. Hence we can’t say it depends on company or your disclosure. But the only thing that is in your hand is, choose the company based on their past record, performance, price (one of the condition, but not the major) and disclose your facts without hiding anything. This is what you and me can do. Even me too don’t want to take change especially when it comes to life insurance. But if we are at right path then I don’t think no one can deny. Hoping for the best and regulator.

  3. Ram Borase says

    Hello Sir,

    First of all Thank you so much for proving detailed information!

    I have few quires as mentioned below:

    1. As you suggested to Mr. Parag JOSHI bying Max Life, HDFC or ICICI
    2. If, I purchased term plan from one of these options for 50 Lakhs, is it required to adding riders for critical illness?
    If you answering YES! then which insurance company provide best options for this.
    3. OR else any options for separately buying critical illness factor .

    Thanks in advance!
    Ram BORASE

    • says

      Ram-Riders are additional features to your main plan. So it is your choice to choose riders. In my view if term plan offers it then go ahead. But best option is to buy it separately from general insurers.

  4. Sachin Samuel says

    Hi Basavaraj,

    Brilliant article! Appreciate your work.

    I have few questions.

    1. I am 33 years old and looking for term insurance. When I called policybazar, they recommended to break the cover amount and get 2 term insurance instead of one, so that incase one of the insurance company rejects claims, my family will still have chance with the second company.

    Do you think this is a good idea?

    2. I was planning to go with Aviva and Aegon religare, 50 lakh each. Do you think it is good idea? if not can you recommend which one should I choose?

    Once again, thanks for the excellent information and thanks in advance for answering my queries.


    • says

      Sachin-1) It is good to break. Have you thought that what will be guarantee in future that one insurance company will not pass the information to another by stating the reasons behind claim rejection? Hence disclose all facts correctly and buy one product.
      2) Better to go with HDFC, ICICI, Max Life, SBI or LIC (costliest).

  5. PARAG says

    Hello Sir / Madam

    I am Parag Joshi, My Date of Birth is 08-07-1981, Annual Income is Rs. 10 Lakhs.

    Planing to buy NEW TERM policy of Rs. 01 crore.

    I have seen several insurance company term plan & premium are as below :

    LIC – 35,000/-
    AVIVA I LIFE – 9000/-
    MAX LIFE – 10,000/-
    HDFC CLICK2PROTECT – 13,800/-




    Thanks & Advice which is good over all. . .

    Call Me on – 9324239400

    • says

      Parag-You can go with Max Life, HDFC or ICICI (because all three offer you online term plan). If you are staunch believer in LIC then pay more and be with LIC. In my view, if you declare all facts then I don’t think your nominee will face any issue.

  6. Teja says

    Wonderful and the most important info required for any person who wants to select their insurer. Unfortunately, most people aren’t aware of this. This is the list which separates the market lions from the rest. LIC leads as usual and no surprises for this. Basu, thanks for sharing this.

  7. Sushila says

    A great article, very helpful for the investor community. specially when the insurers are luring the investors based on this criteria.
    I also read that one should ask the agents for the break of claims ratio into;
    Maturity Claim
    Quick Claim
    Surrender Claim
    Settlement Claim
    Would appreciate some info on the above and how this should affect an investors decision making.

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