Area
|
Life (in USD Billion)
|
Non-Life (in USD Billion)
|
Total (in USD Billion)
|
World
|
2654.55
|
2123.7
|
4778.25
|
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Non-Life Insurance
|
2.9
|
4.8
|
Here are some figures to give you a true picture of insurance –
The amount paid as insurance in India and the world has increased slightly –
Life Insurance
|
4.3
|
1
|
Total Real Premium Growth Rate in 2014 (% growth rate over 2013)
|
World Figures (%)
|
India Figures (%)
|
India
|
55.3
|
14.59
|
69.89
|
Executive Summary – Insurance is very important as it helps to mitigate risk and protects against unfortunate events from a financial aspect. It is important to get insured from the right company. Claim settlement ratio, Incurred Claim Ratio, Grievances Resolved are some figures that help you selecting the right insurer.
|
Private Insurance Companies
|
88.31%
|
89.40%
|
– Mandating all insurers to have Board approved Insurance Awareness Policy.
– Release of handbooks such as “Introduction to Insurance”, “A Handbook on Insurance” and “CropInsurance” to make people understand about insurance the previous year and continuing them in 2014-15.
As a policyholder or a person interested in buying insurance, one would be interested in parameters that help us decide which insurance company to buy a policy from such as claim settlement figures etc.
LIFE INSURANCE
Death Claims for 2014-2015 –
The life insurance companies settled 8.51 lakh claims on individual policies, with a total claim amount payment of Rs. 11,788.67 crore. The number of claims repudiated/rejected was 18,231. These amounted to Rs. 701.69 crore. The number of claims pending at the end of the year was 7,061 and the amount involved was Rs. 453.15 crore.
Claim settlement ratio is the the total number of death claims settled by an insurance company compared to the total number of death claims received by the company.
Company
|
Settlement Percentage (2013-2014)
|
Settlement Percentage (2014-2015)
|
LIC
|
98.14%
|
98.19%
|
Company
|
Settlement Percentage (2014-2015)
|
LIC
|
99.64%
|
Private Insurance Companies
|
91.20%
|
* Source – IRDAI Annual Report 2014-15
During the FY 2014-15, the non-life insurance sector settled 92.36 lakh number of health insurance claims that amounted to Rs. 18,223 crore towards health insurance claims.
The number of claims pending at the end of the year at 6.50 lakh is much lower than the number of claims pending at the beginning of the year at 10.07 lakh indicating improvement in claims service of insurers.
65% of the claims were settled via the cashless mode. The remaining 35% were settled through reimbursements.
Now let us look at insurer level details which can give you some direction in choosing an insurer –
CLAIM SETTLEMENT AND CLAIM REJECTION –
Here is data on the private life insurance companies and the how they have handled the claims –
Company and Year of Incorporation
|
Claims Paid (%)
|
Claims Rejected (%)
|
Birla Sun Life (2001)
|
95.30%
|
3.02%
|
Max Life (2000)
|
96.03%
|
3.90%
|
ICICI Prudential (2000)
|
93.80%
|
5.42%
|
India First (2009)
|
72.21%
|
22.84%
|
Edelweiss Tokio(2011)
|
57.14%
|
37.82%
|
* The numbers may not add up to 100% as there might be claims pending.
* It is possible that newer companies have a higher rejection rate as they will have more early claims.
Here are details on companies numbers for term insurance –
Company
|
Claim Amount Initiated
(Rs. In Lakhs) |
Claim Amount Paid (Rs. In Lakhs)
|
Ratio of claim amount paid to claim amount initiated
|
LIC
|
8905.04
|
8475.26
|
95.17%
|
ICICI Prudential
|
353.46
|
278.6
|
78.82%
|
Aviva
|
119.84
|
85.84
|
71.63%
|
Bajaj Allianz
|
440.98
|
360.2
|
81.68%
|
Max Life
|
250.01
|
214.6
|
85.84%
|
Data on non-life insurance companies’ incurred claim ratio – Incurred claim ratio is the ratio of claims paid by the company to the premium collected. As a policyholder, the higher the incurred claim ratio, the better for you as it means premium collected is being used to pay for claims. But the number does not indicate how soon or delayed the claims are settled.
Company
|
Type
|
Net Premium Earned (Rs. In Lakhs)
|
Claims Incurred (Rs. In lakhs)
|
Incurred Claim Ratio(%)
|
New India
|
Public
|
1331529
|
1118804
|
84.02%
|
Oriental
|
Public
|
642517
|
526150
|
81.89%
|
ICICI Lombard
|
Private
|
423533
|
344344
|
81.30%
|
Bajaj Allianz
|
Private
|
383190
|
275599
|
71.92%
|
TATA AIG
|
Private
|
180224
|
127616
|
70.81%
|
Apollo Munich*
|
Standalone
|
65588
|
41343
|
63.03%
|
Net Premium earned in Fire, Motor, Marine, Health and Others’ Insurance
* Apollo Munich -Only Health Insurance
Company
|
Opening Balance
|
Reported in the year
|
Resolved in the year
|
% Resolved in the year
|
LIC
|
544
|
85284
|
85828
|
100.00%
|
ICICI Prudential
|
13
|
19697
|
19677
|
99.83%
|
Bajaj Allianz
|
4
|
52314
|
52308
|
99.98%
|
Aviva
|
0
|
6606
|
6606
|
100.00%
|
Max Life
|
6
|
19389
|
19395
|
100.00%
|
Non- Life Insurers – Grievances Data (2013-14)
Company
|
Opening Balance
|
Reported in the year
|
Resolved in the year
|
% Resolved in the year
|
ICICI Lombard
|
25
|
6854
|
6855
|
99.65%
|
Reliance
|
60
|
2598
|
2618
|
98.50%
|
TATA AIG
|
1
|
4947
|
4948
|
100.00%
|
United India
|
342
|
6197
|
6321
|
96.67%
|
Apollo Munich
|
2
|
1761
|
1760
|
99.83%
|
When you are planning to buy insurance, do not only take a look at the sum assured and the premium. You should focus on factors such as claim settlement ratio, number of rejections, time taken to resolve complaints and time taken to pay the claim amount. This report by IRDAI helps you identify some of these factors for the insurance companies that you are considering. You should take a look at the report before you buy the insurance policy. It will help you in having better insurance.
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