Health Insurance Claim Settlement Ratio

Claim Settlement Ratio (CSR) in health insurance indicates the percentage of claims an insurer settles in a year. A high CSR ensures reliability, faster claim approvals, and financial security, helping policyholders choose a trustworthy insurer.
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3 mins
26-February-2025

When it comes to health insurance, one of the most important aspects that individuals must consider is the claim settlement ratio of the insurance company. This is the percentage of claims that an insurer settles every year compared to the total number of claims made. In other words, it indicates how efficient a health insurance company is in settling claims.

What is a ‘claim settlement ratio’ in health insurance?

When selecting a health insurance policy, the claim settlement ratio (CSR) is a critical factor. It provides valuable insight into an insurer's reliability and efficiency in processing claims. A high CSR signifies that the company promptly addresses policyholders' claims, which is vital during medical emergencies. Furthermore, a strong CSR often reflects the insurer's robust financial health, ensuring they can cover substantial medical treatment costs.

In addition to the CSR, it's prudent to consider the claim repudiation ratio (the percentage of claims rejected) and the claim pending ratio (the percentage of claims still under process). These ratios together offer a comprehensive view of an insurer's claim handling practices.

Here's an example of how claim settlement ratio works:

  • Total number of claims filed: 1,000
  • Number of claims settled by the insurance company: 950
  • Number of claims not settled or rejected: 50

To calculate the claim settlement ratio:
Claim Settlement Ratio = (Number of claims settled / total number of claims filed) * 100
Claim settlement ratio = (950 / 1000) * 100

So, in this case, the claim settlement ratio becomes 95%.

Claim repudiation ratio

Claim repudiation ratio is the percentage of claims rejected by the insurer due to various reasons. Insurers reject the claims mostly because of fraud, non-disclosure of pre-existing medical conditions, or incorrect information provided by the customer.

Claim pending ratio

Claim pending ratio is the percentage of claims not settled by the insurance company within the standard timeframe.

What is the importance of a claim settlement ratio in health insurance?

The claim settlement ratio of health insurance companies is a very important factor in choosing a health insurance policy. Customers need to be aware of the insurer's claim settlement record. The claim settlement ratio in health insurance helps in understanding how much a customer can rely on the insurer when it comes to covering medical expenses. Hence, an insurance company with a high settlement ratio is considered trustworthy and reliable.

  • CSR plays a crucial role in evaluating the reliability and trustworthiness of health insurance providers.
  • A high CSR indicates that an insurance company is more likely to fulfil its promises in times of need.
  • It also shows that the company has a streamlined claims settlement process that is transparent, efficient, and customer-friendly.
  • When it comes to health insurance, a high CSR should be a top priority for policy buyers to ensure that their medical expenses are adequately covered without any hassle.

You can look for some of the best health insurance policies in India on Bajaj Finance Insurance Mall.

List of top health insurance companies with high claim settlement ratio in India

Here’s a quick view of some of the top health insurance companies and their claim ratio of health insurance companies, highlighting their effectiveness in settling claims and their reliability in covering medical expenses.

Insurance company name

Claim settlement ratio

Bajaj Allianz General Insurance

96.85%

ICICI Lombard General Insurance

97.10%

HDFC ERGO General Insurance

99.87%

Aditya Birla Health Insurance

94%

 

What is Incurred Claim Ratio (ICR) in medical insurance?

The Incurred Claims Ratio (ICR) in health insurance measures the proportion of total claim payouts against the total premiums received within a financial year. Essentially, it indicates how much of the premium collected is used to settle claims. For instance, an 88% ICR means that for every Rs. 100 collected in premiums, the insurance company pays out Rs. 88 in claims. The remaining Rs. 12 represents the company's operational profit.

Where to check the Incurred Claim Ratio of an insurance company?

The Insurance Regulatory and Development Authority of India (IRDAI) annually publishes the Incurred Claim Ratio (ICR) for all health insurance companies. This report breaks down ICRs for different insurance types and provides the company's overall ICR. Therefore, you can use the IRDAI's annual report to specifically determine the health insurance ICR for a particular company.

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Health insurance claim settlement process

To ensure policyholders receive their benefits, the health insurance claim settlement process follows a structured path. First, the policyholder submits a claim with the required documentation. The insurer then evaluates and processes the claim according to the policy's terms and conditions. The claim settlement ratio (CSR) serves as a critical measure of an insurer's claim processing efficiency. A higher CSR indicates that the insurer is more reliable and prompt in settling claims, which leads to faster reimbursements and greater customer satisfaction.

Cashless claim process

When seeking treatment at a network hospital associated with your health insurance, the claim process generally follows these steps:

  1. Claim intimation: Inform the insurance company about your hospitalization or treatment.
  2. Document verification: Provide the required medical and policy documents for review.
  3. Document approval: The insurance company assesses the documents and approves the claim.
  4. Claim settlement: The hospital is directly paid by the insurance company, or you are reimbursed according to policy terms.

Reimbursement claim process

If you choose to receive medical treatment at a non-network hospital, you'll need to file a reimbursement claim. This means you'll pay the hospital expenses upfront and then seek reimbursement from your insurance provider. Here's the general process:

  1. Claim Intimation: Notify your health insurance company about your claim.
  2. Document Submission: Provide all necessary medical bills, reports, and claim forms.
  3. Document Approval: The insurer reviews and approves your submitted documents.
  4. Claim Reimbursement: The approved amount is reimbursed to you by the insurance company.

What documents are required for claim settlement ratio

To file a health insurance claim, you'll generally need to provide the following documents:

  • Completed claim form
  • Claimant's identification proof
  • Doctor's medical certificate
  • FIR (if applicable, in case of accidents)
  • Prescriptions and payment receipts from the pharmacy or hospital

How to check health insurance claim settlement ratio?

To check the health insurance claim settlement ratio, visit the Insurance Regulatory and Development Authority of India (IRDAI) website, where they publish annual reports and updates. You can also review the claim settlement ratios provided in insurers' annual reports or through comparison websites that track these metrics, offering insights into each insurer's efficiency in handling claims.

How do I read or understand the claim settlement ratio data?

Understanding the claim settlement ratio in health insurance data can seem like a daunting task, especially for new health insurance buyers. However, it is an essential aspect of choosing the right insurer for your health needs. Here's how you can understand the claim settlement ratio data:

You will find the health insurance claim settlement ratio given in percentage, as shown in the above table. This refers to the number of claims settled against the total number of claims received yearly. A high health insurance claim settlement ratio indicates that the insurer has a strong financial standing and settles the claims promptly.

You must compare health insurance on the basis of claim settlement ratio of various insurers and buy a health insurance policy to stay adequately covered during an emergency. You can access this data on the insurer’s website or by contacting them directly. You should also check the claim repudiation ratio and claim pending ratio of the insurance company to make a wise decision.

Frequently asked questions

What is a good claim settlement ratio for a health insurance company?

A good claim settlement ratio for a health insurance company should ideally be above 90%. This indicates that the insurer can settle the claims efficiently, as it has a strong financial holding.

What is the formula for calculating the claim settlement ratio?

The formula for claim settlement ratio is: (Total number of claims settled/Total number of claims received) x 100.

What is the best claim settlement ratio in health insurance?

There is no universal standard for the best claim settlement ratio in health insurance. But experts recommend buying health insurance from insurance companies that have a ratio above 95%.

What is the difference between a claim settlement ratio and the incurred claim ratio?

The claim settlement ratio refers to the percentage of claims that an insurer settles compared to the total number of claims received. The incurred claim ratio refers to the total value of claims paid by the insurer against the total premium collected. Both ratios are important factors to consider when choosing an insurer. The incurred claim ratio also considers the medical treatment cost and is an important indicator of the insurer’s ability to cover medical expenses.

How can I check the claim settlement ratio of a health insurance company published by the IRDA?

The IRDA publishes the claim settlement ratio of all insurance companies on its website. You can find the IRDA health insurance claim settlement ratio on the IRDA's official website. You can also find the ratio on the insurance company's website or ask the company directly for the information.

Where to check the claim settlement ratio of health insurance?

You can check the claim settlement ratio on the IRDAI website, in annual reports of insurance companies, or through financial comparison websites that list and analyse the ratios of different health insurers.

Which company has the highest claim settlement ratio?

The company with the highest claim settlement ratio can vary annually. Check the latest IRDAI reports or reputable financial comparison sites for the most current data on which insurer leads in claim settlement efficiency.

Which health insurance has the best claim-settlement ratio?

It's important to understand that claim settlement ratios can fluctuate annually, and "best" can depend on individual circumstances. However, several companies consistently demonstrate strong claim settlement performance. To find the most up-to-date information, refer to the IRDAI's (Insurance Regulatory and Development Authority of India) official website, which publishes annual reports on insurance companies. You can also consult the individual company websites for their latest figures.

Which company is No. 1 in claim settlement ratio?

Pinpointing a single "No. 1" company is difficult as ratios change and may vary depending on the type of health insurance. Always check the latest IRDAI data to make an informed decision.

What are the highest claim settlement ratios in health insurance?

Generally, a claim settlement ratio of 95% or higher is considered very good. However, it's crucial to look beyond just the ratio. Consider factors like the types of claims settled, the speed of settlement, and customer reviews. Remember that a high ratio indicates efficient claim processing, but it doesn't guarantee a claim will be approved in every case. The actual approval depends on the policy terms and conditions.

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