Latest IRDA Life and Health Insurance Claim Settlement Ratio 2025

The latest IRDA Life and Health Insurance Claim Settlement Ratio 2025 was released on 23 Dec 2024. Let us look into this interesting data.

What is the meaning of the Claim Settlement Ratio?

Claim Settlement Ratio is the indicator of how many death claims a life insurance company settles in any financial year. It is calculated as the total number of claims received against the total number of claims settled. Let us say, the Life Insurance Company received 100 claims and among those, it settled 98, then the claim settlement ratio is said to be 98%. The remaining 2% of claims were rejected by the Life Insurance Company.

Based on this, we can easily assume how customer-friendly they are in dealing with death claims. However, I warn you that this claim settlement ratio is raw data.

It will not give you a clear picture of what types of products they settled. They may be Endowment plans, ULIPs, or Term Insurance Plans. Hence, this is not the sole criterion in judging the performance of a life insurance company.

More than that we don’t know for what reasons the insurance company rejected the claims. Hence, don’t consider this as a major factor in deciding the insurance companies.

Some interesting facts from IRDA Annual Report 2024

• The Unclaimed Amounts of Life Insurers at the beginning of the FY 2023-24 was Rs.22,237 Crore.
• India’s insurance penetration (which is the % of the country’s GDP spent on insurance premiums) dropped to 3.7% from 4% last year.
• Insurance Density Increased. Insurance density measures the average amount spent on insurance by each person in the country. In FY 2023-24, India’s insurance density increased to USD 95 from USD 92 the previous year.
• For new business in the Life Insurance sector, the major contributor for LIC is through agents (96%). But for the private sector, its Corporate Agents – Banks (51%).
• In Health Insurance, it is individual agents who contribute more (30%), followed by brokers (29%) and direct sales (28%).
• During 2023-24, 2,15,569 grievances were received on Bima Bharosa portal out of which 1,20,726 were related to Life Insurance business and 94,843 were related to General Insurance business.
• Among them, death claim-related claims were 5%, survival claims 19.95%, policy serving 24%, and unfair business practices (18%).
• In terms of general insurance, the major complaints were related to claims (68%).

Latest IRDA Life and Health Insurance Claim Settlement Ratio 2025

Latest IRDA Life Insurance Claim Settlement Ratio 2025

Since two years, IRDA not publishing the individual Life Insurance companies claim settlement ratio. Instead, a conslidated table is available as below.

Unsure of the reasons for discontinuing this data. However, as the claim settlement ratio of individual companies not available publically, be cautious if any insurance company disclose it.

One noticeable thing is death claim payout is less compared to maturity and surrender of policies.

Latest IRDA Health Insurance Incurred Claim Settlement Ratio 2025

Below table is the latest IRDA Health Insurance Incurred Claim Settlement Ratio. For life insurance it is always claim settlement ratio. However, for health insurance, it is claim incurred ratio.

ncurred Claim Ratio or ICR is a ratio of the total value of claims paid or settled to the total premium collected in any given year. This can be calculated as an Incurred Claim Ratio or ICR=(Total Value of Claims Paid/Total Premiums collected)*100.

For example, let us say Company ABC settled the total claim amount of Rs.90 Cr in the year 2018-19. In the same year, it collected Rs.100 Cr as a total premium. In this situation, the incurred ratio stands to be 90%.

Regarding health insurance, I strongly suggest you to refer my recent post “Top 5 Best Health Insurance Companies in India 2025“. This article will gives you more insight than the above plain claim settlement incurred ratio.

Conclusion – You noticed that with this above shared IRDA data, it is hard to judge of which company is best and worst. Hence, rather than relying on claim settlement ratio, you have to look for policy features, premium affordability, your comfort with the company and lastly disclose the facts properly so that you will not give any room for insurance companies to reject your claim in future.