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Navigating the world of insurance—be it life, health, or general—can often feel overwhelming. With countless insurers in the market, choosing the right one goes beyond just comparing premiums and features.
One of the most critical metrics that can help steer your decision is the claim settlement ratio (CSR).What is claim settlement ratio?The claim settlement ratio is the percentage of claims an insurer settles in a given year compared to the total number of claims it receives. It serves as a key indicator of an insurer's reliability and efficiency in honoring claims.Published annually by the Insurance Regulatory and Development Authority of India (IRDAI), the CSR gives policy buyers a transparent and data-backed way to assess the credibility of insurers.Why CSR mattersThe core purpose of insurance is to provide timely financial support during emergencies. A high CSR indicates that the insurer is dependable and prompt in claim settlements, minimizing the chances of distressing delays or rejections. Although no minimum benchmark is prescribed, a CSR of 95% or above is typically considered a sign of trustworthiness.How it's calculatedThe CSR is calculated using the formula:What the latest data shows (FY 2023–24)According to IRDAI's latest data for 2023–24:
- Acko General Insurance led among private general insurers, settling 99.91% of claims within 3 months.
- Navi General Insurance Ltd performed slightly better with 99.97% claims settled within the same time frame.
- On the other end, Zuno General Insurance Co. Ltd. (formerly Edelweiss General Insurance) had the lowest CSR among private players at 83.12%.
- Among public sector insurers, The Oriental Insurance Co. Ltd. lagged with just 65.08% of claims paid in under 3 months.
Overall, general insurers in India paid out 81.13% of total claims within 3 months of claim intimation, and 16.3% were settled between 3 to 6 months.
The total number of claims paid during FY 2023–24 stood at 71,200,854.Stand-alone health insurers
- Aditya Birla Health Insurance topped the list with a 92.97% claim settlement ratio within 3 months.
- It was followed by Care Health Insurance at 92.77% and Niva Bupa Health Insurance at 92.02%.
- Star Health and Allied Insurance Co. Ltd., although having the lowest CSR within 3 months among stand-alone health insurers, settled the highest number of claims at 16,80,171 in that period. It was followed by Aditya Birla Health Insurance, which settled 12,24,376 claims.
The claim settlement ratio isn’t just a number—it’s a direct measure of how likely your insurer is to stand by you in your time of need. Before signing on the dotted line, make sure to check this figure. In a market where promises are plenty, the CSR is one of the few hard metrics that truly speaks for an insurer's performance.(With input from ET reports)
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