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Knowledge Base Health Insurance Displaying items by tag: claim settlement ratio
Displaying items by tag: claim settlement ratio

Life Insurance - Claim Settlement Ratio 2011-12


With online portals such as Policy Bazaar, comparing life insurance plans now is easy, buying them is even easier. It is filing a claim and getting the claim amount that’s the real tough nut to crack. And we are not insulting your smartness; we know that you’ll make your way around it. But God forsake, if something happens to you and your dependents have to file a claim, they might not just make it that smart.

 

This takes us to the million dollar question – How to make sure your claim will be settled?

 

The answer is to always check the Claim Settlement Ratio of the insurer you are buying from. Claim Settlement Ratio is the ratio of settled claims to the total claims filed in a given accounting period.


Claim Settlement Ratio = No. of Claims Settled / Total No. of Claims Filed

 

So, a 95% claim settlement ratio implies that of a total of 100 claims, 95 claims were settled by the insurer. The 5 claims stand either repudiated or pending. 

 

Here’s the Claim Settlement Ratio (in decreasing order) for the year 2011-12.

 

Rank

Insurer

Total Claims (Individual Death)

Claims Paid

Claim Settlement Ratio

1

LIC

731336

712501

97.42

2

ICICI Prudential

14829

14314

96.53

3

HDFC Standard

5149

4952

96.17

4

SBI Life

11864

11328

95.48

5

Kotak Mahindra

2949

2716

92.10

6

Birla Sunlife

10914

9925

90.94

7

Bajaj Allianz

27212

24658

90.61

8

Max Life

9031

8113

89.84

9

Aviva

2240

2006

89.55

10

ING Vysya

2826

2510

88.82

11

Bharti AXA

935

820

87.70

12

Star Union Dai-Ichi

477

411

86.16

13

Reliance

20534

17367

84.58

14

Tata AIA

5107

4287

83.94

15

IndiaFirst

546

449

82.23

16

Metlife

2174

1769

81.37

17

Canara HSBC

448

361

80.58

18

Sahara

1044

814

77.97

19

Future Generali

2007

1366

68.06

20

IDBI Federal

627

423

67.46

21

Aegon Religare

274

181

66.06

22

Shriram Life

1443

937

64.93

23

DLF Pramerica

233

57

24.46

Industry Total 

854200

822266

96.26

Source: IRDA Annual Report 2011-12


Limitation of Claim Settlement Ratio


Claim Settlement Ratio is surely a way to know the chances a life cover will be provided when your family needs it. But it gives no idea about the actual time period taken by the insurer to pay out the money.


So, there can be two insurers with the same ‘Claim Settlement Ratio’ with one of them settling a claim within a month while the other taking half an year to do the same. So, how to make sure, your claim will be settled in a timely manner?

 

Along with the CSR, you should also check the usual time taken by the insurer to settle a claim. Read More -

http://knowledge.policybazaar.com/life-insurance/item/1124-settling-your-claims-who-does-it-faster.html

Published in Claims

Health Insurance - Incurred Claim Ratios (for 2011-12)


Every insurer keeps the best foot forward when it comes to selling its insurance plans. But it is the settlement of claim that decides how good or bad an insurer really is.

Every policyholder pays the premium with a trust on his/her insurer that he’ll be provided financial assistance in times of need, in a simple, smooth and timely manner. There are certain parameters to measure this trust. One such parameter is Incurred Claim Ratio

 

What is Incurred Claim Ratio?


 

It is the ratio of net claim settlement cost incurred by the insurer to the net premium earned for a given accounting period.  


Incurred Claim Ratio = Net Claims Incurred / Net Earned Premium

 

So, a 90% incurred claim ratio implies that for every 100 rupees earned as premium, 90 rupees were spent on the claims settled by the insurer. Thus, 10 rupees is the net profit of the insurer. Unlike claim settlement ratio, incurred claim ratio can be above 100%. Obviously, that would imply that the insurer suffered a financial loss during that particular year.

 

How is it different from Claim Settlement Ratio?


Chances are thick that you stumbled upon this article while searching for Claim Settlement Ratio. These two are often confused but are quite different. Claim Settlement Ratio is the ratio of settled claims to the total claims filed in a given accounting period.

 

Claim Settlement Ratio = No. of Claims Settled / Total No. of Claims Filed

 

So, a 90% claim settlement ratio implies that of a total of 100 claims, 90 claims were settled by the insurer. The 10 claims, however, were outstanding or denied.

 

How important is Incurred Claim Ratio for a Policyholder?


 

Incurred Claim Ratio is a reflection of how much an insured can count on his insurer on getting his claim settlement amount, when he makes a claim.  The thumb rule is, higher the ICR, higher level of trust an insured can put on his insurer. It's a way of rating insurance companies. 

 

Also, as a policyholder you stand in a better position to negotiate with an insurer with a low incurred claim ratio.

 

 

What ICR doesn't tell you?


As can be seen in the formula, Incurred Claim Ratio doesn’t take into account the time period taken by the insurer to process and settle a claim. So, there can be two insurers with the same ‘incurred claim ratios’ with one of them settling a claim within 3 months and the other one procrastinating the settlement up to 1 year.

 

The health insurance incurred claim ratio of the insurers for 2011-12 (in decreasing order) is given below:

 

Insurers

Incurred Claim Ratio (%)

Private

L&T General

183.40

SBI General

122.82

Universal Sompo 

102.59

ICICI Lombard

86.19

IFFCO Tokio

85.79

Reliance

85.77

Future Generali

85.58

Bharti AXA

80.44

Cholamandalam

76.51

HDFC Ergo

67.53

Bajaj Allianz

66.52

Royal Sundaram

50.86

TATA AIG 

49.65

Public

National

105.09

Oriental

102.83

United

97.68

New India

97.24

Grand Total

                       93.97

Source: IRDA

 

The health insurance incurred claim ratio of stand alone health insurers for 2011-12 (in decreasing order) is given below:

 

Stand Alone Health Insurer

Incurred Claim Ratio (%)

Star Health & Allied Insurance

95.76

Apollo Munich Health Insurance

58.20

Max Bupa Health Insurance

56.15

Source: IRDA


 

 



Published in Claims

Health Insurance Claim Settlement Ratio (FY 2009-2010) 


Health insurance is the need of the hour. Hospitalization expenses are increasing at a rapid pace. A simple consultation these days cost Rs 500. Being admitted in a hospital can cost thousands of rupees. Using savings to bear hospitalization expenses does not make any sense. Health insurance is a good solution to take care of medical expenses. You can get a good cover with relatively low premium. With just around Rs 3-4 thousand, you can get individual health cover of Rs 2 lacs.

 

Before buying health insurance, you should access many factors. Apart from premium, check the coverage, benefits such as no claim bonus, flexibility to change cover, maternity cover if required etc.

Health insurance claim settlement ratio is also among the factors to check before buying health insurance. A health insurance claim settlement ratio tells us about claims being settled by the insurer. Suppose if total of 10 claims are received by insurer and 6 is settled by them then claim settlement ratio is 60%. The rest 4 could be either rejected or outstanding.

 

We have calculated health insurance settlement ratio of major health insurance companies. The data is computed directly from health insurance company’s websites. The formula used is:

Health insurance settlement ratio= (Health claims settled/total claims) %

Health Claim Settlement Ratio for Financial Year 2009-2010 is:

 

Insurers

Claim Settlement Ratio (%)

Oriental

88

New India

93

United India

95

National Insurance

74

Apollo Munich

85

HDFC Ergo

96

ICICI Lombard

94

Reliance General

76

Bajaj Allianz

95

IIFCO Tokio

58

Star Health

71

Source: Public Disclosure of Insurance Companies

 

fy_2009-201

 

For 2011-12 claim settlement figures, check out - 

http://knowledge.policybazaar.com/health-insurance/item/1122-health-insurance-incurred-claim-ratios-for-2011-12.html

 

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Published in Health Insurance
Friday, 23 December 2011 17:39

Health Insurance- Claim Settlement Ratio

Health Insurance- Claim Settlement Ratio


There are many health insurance plans in the market. Most of the health plans are very comprehensive with many benefits including no sub limits on room rent, maternity benefits, lifelong renewal etc. There are very few things which sets them apart. The basic premise of health insurance is to provide financial assistance in times of need. It could be cashless or reimbursement  and as smooth as possible. However there has been regular complaints about the delay in services on the part of TPA or health insurer.

 

Therefore before randomly choosing a health insurance plan, one should always check the claims data. The claims data will apprise you of total number of claims, how many claims have been settled and rejected. Some claims remain outstanding as well.

 

The health settlement ratio determines the % of claims solved by the insurer. For instance- claim settlement of 80% implies that out of total of 100 claims, 80 claims have been accepted by the insurer. The rest 20 claims have been denied or remain outstanding.

 

Health insurance claim settlement has been calculated as the following formula-

Health insurance claim settlement ratio = claims settled/ (total claims-claims rejected)%

 

The health insurance claim settlement ratio of the insurers for the Quarter 2,  2011 is given below:

 

Insurers

Claim Settlement Ratio (%)

Apollo Munich

76

Bajaj Allianz

84

Bharti AXA

65

Chola MS

62

Future Generali

79

HDFC ERGO

73

ICICI Lombard

65

IFFCO-Tokio

46

Max Bupa

65

Oriental Insurance

92

Reliance General

73

Royal Sundaram

93

Star Health

61

New India Assurance

89

United India Assurance

78

 

Along with health settlement ratio, you should keep in consideration number of claims outstanding and claims rejected. If your claim is always stuck in paperwork, it would not make much sense. Hence try to find out the time taken by the insurer to solve the claim as well.

 

For 2011-12 claim settlement figures, check out -

http://knowledge.policybazaar.com/health-insurance/item/1122-health-insurance-incurred-claim-ratios-for-2011-12.html

 

 

 

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Published in Health Insurance

Health Insurance Claims- Things you should look before buying health insurance


There has always been a doubt in customers mind about whether private company will keep its side of the bargain i.e. it will settle the claim or not. A customer spends premium annually which will cover his medical expenses but there’s always concern in his mind about the claim settlement.

There are three vital claim ratios that one must understand:

  • Claim settlement ratio
  • Claim repudiation ratio
  • Claim pending ratio

Claim Settlement ratio tells us about the claim solving ability of the insurer. If claims are intimated and the insurer solves those, claim settlement ratio would be good. Higher claim settlement ratio implies that majority of claims are getting solved. Example- An insurer has 60% claim settlement ratio which means that insurer settles 60 out of 100 claims.

Health insurance settlement ratio has been calculated as:
Total claims settled/ (total claims-claims rejected) %

Claim repudiation ratio
tells us about the percentage of the claims rejected by the insurer.

Example- Claim repudiation of 20% means 20 cases out of 100 are rejected.
Claims repudiation ratio= (Claims rejected/total claims) %
The reasons for rejection could be false claims, untimely intimation, coverage not covered under the policy etc.

Claims pending ratio tells us about the outstanding claims that have not been settled either way- neither accepted nor rejected.
Example- Claims pending ratio of 40% would mean 40 claims out of 100 are yet to be solved.
Claims pending ratio= (Claims outstanding/total claims) %
Health insurance claims could remain outstanding as a result of unfurnished information like doctors certificate. The insurer takes time to validate the expenses incurred during hospitalization.

How does claims ratio data help me?


Claims data let you understand the history of insurer claims handling process. It should also be noted that new insurers typically would have lower settlement ratio. That is because claims filed so early could probably mean that it could be a fake. Yet claims data does enlighten us in making analysis of companies which have been operating for same period. Even though genuine claims are rarely rejected, knowing about claims does help you arrive at the final decision. If you think that two insurer products have more or less same benefits, knowing that one insurer has 90% claim settlement could clinch the deal.

Policybazaar view:


Health insurance claims are mostly accepted. That’s because of insurer’s service of network hospitals where cashless facility is available. In case of non network hospitals also, as long as treatment is within coverage and stipulated requirements has been fulfilled, claims will be accepted. It must be understood that no insurer rejects genuine claim.
The claim settlement data for quarter ended Dec 31, 2010 of the insurers is given below:

 

Insurers % Claims Settled
Apollo Munich 93%
BAJAJ Allianz 81%
bharti AXA 66%
Cholamandalam MS 59%
Future Generali 66%
HDFC ERGO 75%
ICICI lombard 92%
Iffco-tokio 61%
Max Bupa 54%
Oriental Insurance 88%
Reliance General 61%
Royal Sundaram 91%
Star Health 63%
The New India Assurance 71%
United India Insurance 86%

 

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Published in Health Insurance