Categories: Insurance Planning

IRDA Claim Settlement Ratio 2013-2014-Which is best Life Insurance Company?

Today (8th January 2015) IRDA declared Annual Report 2013-14. This report gives you an insight into the Indian Insurance Industry and also let you know which company is top and how the rest of companies are performing.

Note-

IRDA Claim Settlement Ratio 2014-15-Which is best Life Insurance Company?

Top 5 Best Online Term Insurance Plans in India-2016

Term Insurance-Claim Settlement Ratio no more a big criteria

Below is the latest data of claim settlement ratio for the year 2013-14.

Note-I coloured with green, whose claim settlement is above 90%. I coloured with yellow, whose claim settlement ratio is more than 80% but less than 90%. I coloured with red, whose claim settlement ratio is less than 80%.

You notice that top five companies when it comes to claim settlement ratio, are LIC, ICICI, HDFC, Max Life, and Star Union. You need to concentrate on claim repudiation percentage also. Because, this clearly states the company’s acceptance of the claim it receives. Along with that, pending percentage indicates the slowness due to one reason or another.

What are the limitations of this report?

  • It will not differentiate the type of products, which each company settled like endowment, term insurance or ULIPs.
  • Reasons for rejection are not available.
  • Usually settlement ratio increases as the company getting older into this industry. So older the insurance company higher chances of growing it’s settlement ratio.
  • To add my reasoning to above point, usually early claims means the claims which are within 2-3 years of buy. Including LIC, all insurers do a strict scrutiny of such early claims. So there is high probability of rejection. If the insurance company started it’s business just 3-5 years back then it may receive all claims under early claims. So rejection may be higher. Ending this as a lower claim settlement ratio.
  • No guarantee that a company which has the highest percentage of claim settlement ratio not rejects your claim.
  • This data is for a year. So insurance companies either settled claims within a few days or might have taken less than a year.

Visit my earlier post “IRDA Claim Settlement Ratio 2012-2013-What it indicates?” to compare the report of previous year.

Hope this report will shed some light for you before selecting your insurance company.

BasuNivesh

View Comments

  • I was buy a ageon life policy money back but not satisfy the poly duet o advisor worryingly advice so how can i refund my policy we have already pay 2 and half years

    • Mkhan-Either you have to forget the amount or continue up to 3 years and then get some part of what you paid by surrendering.

      • Hi,

        Thank you for notes and its very helpful guide to plan our finances. I have question regarding Term insurance, say if i am smoker and consume alcohol on weekends and by mentioning it i am going to pay extra 4-5k premium which i understand. My query is, even after mentioning that i am smoker and alcohol consumer and paying extra premium, do the insurance company has the right to reject my claim after few years or many years if incase the death is caused due to any of these reasons?

        please help me to understand this clause.

        • Vel-They can't reject the claim if death occurred due to smoking habit (which is already known to insurer).

  • Hi Basavaraj,

    I am 31 year old, Non smoker and looking for best Term Insurance for 20-25 year & some investment plan for short term say 10 year for good return. I am quite confused as one of the my close relative LIC agent said that other companies might not pay/Reject the desired claim saying any other reason and you/your relative will end up saying that "would have been better if we had gone for LIC plan" Is that true? Also have one question- are these LIC policy's customer focused or Agent focused, Whatever i have seen so far don't think it gives greater return on investment and very little death claim. I see agents are growing in terms of wealth but not the actual customer!! strange!

    Please advise me the best plan for Term Insurance & Investment with any specific company details.

    Appreciate your help on it.

    Thank you

    • Deepak-Your doubts are genuine. Your so called relative LIC agent, misguiding you. When it comes to claim rejection, private companies or LIC no one can reject blindly. All agents defend their insurance company. It is natural. Think on your own and decide. Regarding best term plan, refer my latest post "Top 5 Best Online Term Insurance Plans in India-2016". Regarding investment, I can't recommend anything. Because I am not sure about past financial life, present investments and future financial goals.

  • Hi Basa,

    I am 35 years age and my annual income take home is around 5 lacs. I have 35 lacs trem plan of ICICI & 20 Lacs from Aegon Religare. Now, based on claim ratio I am confused in aegon credibility because his % is very low. Some LIC agents also told me that private insurance companies always try to hold the claim for one or the other reasons. Is it correct? Should I drop aegon religare term plan and opt for some other? then which company term plan? what should be my life cover? plz plz reply urgently.

    • Rohit-Don't heed to agent's advice. How can an LIC agent can say that competitive company is BEST? Your insurance cover must be around 15-20 times of your yearly income.

      • SHOULD I CONTINUE WITH AEGON RELIGARE IN SPITE ITS CLAIM RATIO % IS VERY LOW AS COMPARE TO OTHERS LIKE ICICI. CAN I STOP AEGON AND TAKE AROUND 50 LACS TERM PLAN FROM HDFC OR MAX LIFE OR ICICI ?

  • Hi Basavaraj,

    your blog is very useful to get information about insurance policies. thank you so much.
    After reading your all articles. I have decided to get one Term insurance for 30yrs & My age is 28years,.
    But how to decide the cover amount 50L or 75L or 1Cr. please I need a logic for this like how you have given for policy term.
    I am a IT professional with 8lakh PA income.

    • Vishwa-But around 15-20 times of your yearly income. To this amount, add the outstanding loan if you have any.

  • I am planning for sukanya samrudhi yojana for my daughter . she is 2 years old .
    I have plans to settle abroad after may be 5 years . what will happen to the money that I pay for this 5 years and can I continue to pay even after I go abroad .
    for example I become a NRI after I pay 10 years of amount what will be fate of that 10 years money.

    • RAvi-Forget about your NRI status change. First think whether this is a great product to beat the education and marriage inflation? It is a typical debt product handed in political parties. When government changes, then we don't know the faith of such schemes. Stay away.

  • Hi,

    My name is Gautam Shahi, age 22 years. I wanted to buy a Term insurance plan for maximum tenure i.e, 40 years but confused among ICICI Prudential and HDFC life. As i am seeing that premium cost of ICICI is more than ICICI. Apart form them all benefits are same except claim settlement ratio. So can you guide me which one would be better?

  • Hello Basu,

    It's nice reading your blog. Currently i am in search of Term plan for my elder brother fro around 50lakh - 1 crore. His age is 25yrs with yearly income of around 5-6 lakh and non-smoker. I have tried searching many Term plans and came down with two of them. HDFC Life & Edelwise Tokio . But I am being confused on the basis of benefits (Riders) and claim settlement ratio.
    On the basis of riders :- common rider attached is Accidental Disability benefit available in both HDFC & Edelwise.
    Wheres edelwise gets ahead in two cases:- Premium waiver rider and the Term plan premium amount which is comparatively less.
    So, Now looking as per above scenario should i consider HDFC :- Being Trusted, High in claim settlement ratio, although it doen't have premium waiver rider. OR
    Edelwise :- Being Just new company,Low claim settlement ratio,Having fantastic riders and with Less Term plan premium amount?

    Since, Term plan premium will be ultimately cost for me till the uncertain event, I was also looking from coverage part keeping to minimum premium amount. Please advise

  • Hi Basavaraj,

    First of all, I appreciate your effort in providing us with the information. I am new to this stuff. However, I decided to buy a term insurance for 1 cr. After some online research, I would like to go with Max life (50L) and PNB met life (50L). Is this a good idea? Could you suggest something better? I'm 27, m.

    Many thanks in advance.
    Sanjeev

  • Hi Basu,

    I have some queries regarding Home loan.

    I have home loan with HDFC Bank and out standing amount 19lacs , and no og emi's 144 and current interest rate 9.70%.
    I want to move current interest rate 9.55% for this i have to pay conversion charges 5322.If i pay this charges no of EMI's decreased to 141. Here nest reset date is showing 01-feb-2015.

    1.Is that good idea to move current interest rate?
    2.Is that right time to move current interest rate?
    3.Once i move to current interest rate is always applicable to current interest rates(i mean it will always follow the RBI announced interest rate) or i have to pay once again charges?

    Please advice me in detail.

    Thanks,
    chennaiah

          • Chennaiah-By moving to this lower home loan, you can save around Rs.23,000 on interest part for the whole tenure of period. But the cost of change itself is around Rs.5,000. I don't think it creates much difference to you. Banks usually offer such things to lure the new customers or build their new book of loan. Don't heed. Stick to your current floating rate loan. If the difference is more than 1% to 1.5% and the cost is same as that of Rs.5,000, then think of switching.

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BasuNivesh
Tags: IRDA Claim Settlement Ratio 2013-2014
12 years ago

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