Comparing Claims Paid Ratio of Life Insurance Companies

There are the following four major factors to be considered:

1. Claim Paid Ratio: The claim paid ratio is the number of approved/ paid claims divided by the total number of claims received. The Insurance Development Regulatory Authority of India (IRDAI) publishes data on claim paid ratio of various companies from time to time. Go through the data to know the claim paid ratio of various companies. Max Life Insurance, for example, has a claim paid ratio of 99.65% for the year FY 23-24 (Individual Death Claim Paid Ratio as per audited financials for FY'23-24).

2. Turnaround Time (TAT): In insurance, the turnaround time an insurer takes to process a death claim is crucial. A shorter TAT is possible when the insurer’s claim payment process is efficient, the policyholder had made a full disclosure at the time of buying the policy and the nominee has submitted all the required documents on time.

Max Life Insurance offers a proposition of ‘insta-claim service’, which processes the death claims within one day from the claim receipt, subject to the following conditions:

• a) Claim amount on all eligible policies is upto Rs.1 crore
• b) Claims are for policies that have completed three continuous years
• c) All mandatory documents have been submitted before 3:00 PM on a working day
• d) The claim does not warrant any field verification

3. Claims Guarantee: When a nominee approaches the insurer with a death claim, it is the moment of truth of all the promises made by the insurer. If the insurer fails to efficiently and diligently process the claim request, the nominee has to run to the insurer’s office to get the claim and the entire experience is sour. However, there are few insurers who ensure that the claim payment process is smooth for the nominee and travel a mile ahead of others to deliver that promise.

4. Services of a Dedicated Claim Settlement Officer: To facilitate the claim settlement process of life insurance plans some companies have dedicated claims settlement officers. Life insurance companies generally, assign a claims officer dedicated to assisting customers. These officers assist the nominee throughout the claims settlement process taking care of the documentation and procedures to ensure the claim money is smoothly and timely withdrawn by the nominee.

If you are buying a life insurance cover, be sure to research these factors before purchasing.

Click here to know more about the claim process.