life insurance claim settlement ratio: Latest life insurance claim settlement ratios of insurance companies in India

life insurance claim settlement ratio: Latest life insurance claim settlement ratios of insurance companies in India


As the main motto of buying a life insurance policy is to secure dependent family members in case of a policyholder’s unfortunate death, the claim settlement ratio plays an important role when choosing the policy. Claim settlement ratio is a percentage of claims that the insurer has paid out against the number of outstanding claims during a financial year. So if you are planning to buy a new life insurance policy or renew your existing one, along with checking the premium amount and coverage, you must check the claim settlement ratio of the insurer.

The Insurance Regulatory and Development Authority of India (Irdai) has published the details of claim settlements of all life insurance companies for the year 2021-22 in its annual report. As per this latest data, life insurance companies in India have registered a slight improvement in their individual death claim settlement record in 2021-22 compared to a year earlier, which was an extra ordinary year due to covid-19 related deaths. The individual death claim settlement ratio of the life insurance industry increased to 98.64 per cent in 2021-22 from 98.39 per cent in the previous year, as per Irdai’s report.

Individual death claims settlement by % of policies
Life Insurer Total claims Claims paid Claims repudiated
No. of policies No. of policies % of total claims No. of policies % of total claims
Aditya Birla Sun Life 10008 9815 98.07 186 1.86
Aegon Life 720 713 99.03 6 0.83
Ageas Federal 2694 2614 97.03 57 2.12
Aviva Life 1672 1645 98.39 27 1.61
Bajaj Allianz 21050 20844 99.02 195 0.93
Bharti Axa Life 3203 3174 99.09 27 0.84
Canara HSBC 2813 2769 98.44 41 1.46
Edelweiss Tokio 995 976 98.09 19 1.91
Exide Life 7279 7213 99.09 7 0.1
Future Generali 1664 1600 96.15 64 3.85
HDFC Life 27122 26758 98.66 136 0.5
ICICI Prudential 22281 21795 97.82 398 1.79
India First 4937 4785 96.92 143 2.9
Kotak Life 7133 7049 98.82 60 0.84
Max Life 31035 30830 99.34 205 0.66
PNB Met Life 8586 8357 97.33 224 2.61
Pramerica Life 1061 1043 98.3 16 1.51
Reliance Nippon 13730 13548 98.67 174 1.27
Sahara Life 1166 1132 97.08 16 1.37
SBI Life 55786 54140 97.05 1541 2.76
Shriram Life 5865 5620 82.39 163 11.61
SUD Life 2951 2875 97.42 74 2.51
Tata AIA Life 8069 7950 98.53 117 1.45
LIC 1367104 1349865 98.74 8713 0.64

Source: Irdai Annual Report 2021-22

Max Life Insurance has the highest claim settlement ratio in terms of the number of claims with 99.34 per cent for the year 2021-22. With a 99.09 per cent death settlement ratio, Exide Life insurance and Bharti Axa Life Insurance bagged the second position. As many as 14 life insurers have a claim settlement ratio of more than 98 per cent.

All the private life insurance companies had together settled 2.37 lakh death claims while LIC alone settled 13.49 lakh death claims in 2021-22, as per the Irdai report. In terms of benefit amount paid, private insurers settled Rs 17,410 crore whereas LIC settled Rs 28,408 crore in 2021-22. In terms of numbers, LIC registered a 98.74 per cent claim settlement ratio and in terms of benefit amounts, the insurer maintained a 96.02 per cent claim settlement ratio.

Also Read:
Latest health and general insurance claim settlement ratio of companies in India

The claims repudiated ratio indicates how many claims the insurer finds to be invalid and hence, has not paid the claimed amount. There are many reasons a life insurance company will repudiate a claim after it has accepted it for processing.

Individual death claims settlement by % of benefit amount
Life insurance company Total no. of claims Total amount of claim (cr) No. of claims paid Amount of claims paid (cr) % No. of claims paid % amount of claims paid
Max Life 31035 2077.31 30830 2008.94 99.34% 96.71%
Bharti Axa Life 3203 243.59 3174 234.72 99.09% 96.36%
Exide Life 7279 318.62 7213 306.81 99.09% 96.29%
Aegon Life 720 276.48 713 273.04 99.03% 98.76%
Bajaj Allianz 21050 825.97 20844 771.88 99.02% 93.45%
Kotak Life 7133 614 7049 586 98.82% 95.53%
LIC 1367104 29586 1349865 28408 98.74% 96.02%
Reliance Nippon 13730 360.76 13548 344.14 98.67% 95.39%
HDFC Life 27122 2918.24 26758 2608.22 98.66% 89.38%
Tata AIA Life 8069 1603.93 7950 1518.17 98.53% 94.65%
Canara HSBC 2813 288.10 2769 277.79 98.44% 96.42%
Aviva Life 1672 270.95 1645 266.70 98.39% 98.43%
Pramerica Life 1061 53.04 1043 51.34 98.30% 96.79%
Edelweiss Tokio 995 159.86 976 152.06 98.09% 95.12%
Aditya Birla Sun Life 10008 880.32 9815 846.43 98.07% 96.15%
ICICI Prudential 22281 3118.04 21795 2977.50 97.82% 95.49%
SUD Life 2951 171.32 2875 156.60 97.42% 91.41%
PNB Met Life 8586 717.43 8357 669.69 97.33% 93.35%
Sahara Life 1166 12.85 1132 12.47 97.08% 97.04%
SBI Life 55786 2910.14 54140 2751.53 97.05% 94.55%
Ageas Federal 2694 134.73 2614 122.63 97.03% 91.02%
India First 4937 249.53 4785 227.31 96.92% 91.10%
Future Generali 1664 86.69 1600 77.67 96.15% 89.60%
Shriram Life 5865 203.16 5620 167.39 95.82% 82.39%

Source: Irdai Annual Report 2021-22

Check claim paid ratio by the amount
The claims paid ratio by amount indicates the percentage of the total value of claims submitted to an insurance company that is ultimately paid out. A high ratio would suggest that the company is paying out a large proportion of the total value of claims submitted to it, while a low ratio would suggest that the company is denying or delaying many claims. Both claim paid ratio by numbers and claim paid ratios by amount are used to measure the financial performance of an insurance company, and to assess its ability to pay out claims to policyholders.

“Claims paid ratio by numbers can be useful for policyholders who want to get a sense of how easy it is to file and have claims processed and paid by the insurer. On the other hand, the claims paid ratio by amount can be useful for policyholders who are more interested in the amount of money they might expect to receive if they file a claim,” said Sanjiv Bajaj, Jt. Chairman & MD, Bajaj Capital.

“It’s always best for the policyholder to check and compare both ratios before buying the policy to have a comprehensive understanding of the insurer’s claims-paying ability,” he added.

“It is highly recommended that customers must ensure to check all the reasonably dependable measurement indicators like claims paid ratio by amount, the experience provided by the insurer and how long the insurer takes to settle the claims,” said Tarun Mathur, Chief Business Officer – General Insurance, Policybazaar.com



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