After, the long wait finally, the Insurance Regulatory Development Authority of India or IRDA has finally come up with the newest IRDA claim settlement ratio 2017-18 annual report. Now, the wait is over and today I have chosen to write a blog article on IRDA claim settlement ratio 2017-18 and the Best Term Insurance plans for 2019.
Yes, the IRDA does publish the annual performance report every year around in the month of January. This usually takes a lot of time due to the compilation of many aspects and numerous key parameters. So, the annual report for the F.Y 2017-18 has been published by them in the 2nd week of January 2019. I hope many questions have been answered that were asked by my blog readers in my last year's similar post where I used the annual report of F.Y 2016-17, about the old data that I used there. So, using this year's claim settlement ratio and other relevant data, I would analyse the best term insurance plans for 2019.
I reiterate that one should not consider the claim settlement ratio as the one and only crucial factor, it needs to be construed as one of the additional decisive factors. Most of us want to have the very best thing set up for us and for our family as well. Thus, we do for choosing the best term insurance plans. Before, starting off you may want to browse my previous year's blog post on Best Term Insurance Plans for 2018.
Why IRDA claim settlement ratio 2017-18 is so important?
Here, you need to know what's claim settlement ratio. This means how many insurance claims have been settled in a specific financial year against the number of claims filed before the insurance company. So, it's indeed very significant for one potential individual who is planning or looking for purchasing insurance, he must also look at the claim settlement ratio along with other facets too. Let us first learn why the IRDA claim settlement ratio 2017-18 is really important?
Therefore, claim settlement ratio refers to the number of claims settled against the claims lodged or filed before the insurance company in a particular period. For example, if ABC insurance company does settle 90 claims in F.Y 2017-18 against the total 100 claims filed, it would be said that the claim settlement ratio stands to 90%.
Thus, it is very important to understand that the more the claim settlement ratio is, the more there is a strong probability of settlement of maximum claims which may include a claim of yours as well. So, that is the significance of this claim settlement ratio. But this is not the sole decisive factor for deciding or choosing the best term insurance plans for 2019.
I always prefer plain vanilla term insurance plan over and above traditional life insurance plan. Since I just love to see insurance products as only insurance but not as an investment. Also, it is not prudent either to choose return of premium term life insurance products.
Now let's have a look at the important key element i.e. top 10 lists of highest claim settlement ratio companies for F.Y 2017-18.
List of Top 10 companies having highest IRDA Claim Settlement Ratio 2017-18
Serial No.
Name
No. of Claims Lodged
No. of Claim settled
Claim Settlement Ratio(CSR) %
1
Max Life
10332
10152
98.26
2
LIC of India
739082
724598
98.04
3
Tata AIA
2850
2793
98.00
4
ICICI Prudential Life
11459
11216
97.88
5
HDFC Standard Life
12566
12289
97.80
6
Bharti Axa Life
888
860
96.85
7
Exide Life
3357
3250
96.81
8
SBI Life
18885
18274
96.76
9
DHFL Pramerica Life
592
572
96.62
10
Aditya Birla Sun Life
5491
5292
96.38
Thus, from the above chart you can see that out of the total 24 Life Insurance companies only 14 companies could manage to cross the Claim Settlement Ratio of 95% in 2017-18 as compared to 4 companies who crossed it over 95% in 2016-17.
This looks quite satisfactory that the more and more companies crossing the highest benchmark as compared to previous years. This may be due to the transparency that is being shown by the insured persons during the policy execution or buying and also the stringent regulations of IRDA and also many reporting standards set by the IRDA.
Just find below the details of total 24 companies at a glance for your ready reference.
To download the IRDA Claim Settlement Ratio 2017-18 just click here.
Best term insurance plans for 2019 on the basis of claim settlement ratio(C.S.R) 2017-18:
From the above table, the following companies have managed to retain the top 10 positions in the F.Y 2017-18 on the basis of CSR.
- Max Life,LIC of India,Tata AIA,ICICI Prudential,HDFC Standard Life,Bharati AXA Life,Exide Life,SBI Life,DHFL Pramerica Life,Aditya Birla Sunlife.
How to choose Best Term Insurance plans for 2019?
Currently, there are 24 numbers of life insurance companies operating in India. All of them do sell Term Insurances in different variety of options covering all of our needs. Now, the question is comes to your mind that is all of them good or best suited for everyone. The answer is probably no. Now, take a look at the factors that you should consider before buying a term life insurance.
Determinant factors
While buying a term life insurance policy you should consider the following factors.
- Claim settlement ratio;
- Low premium with high-risk coverage;
- Policy features;
Though from the above chart you would find that Tata AIA(CSR 98%) is retaining the top 3 positions out of the best top 10 positions but the total claims filed before them is only 2850 and they settled 2793 policies and rejected only 57 cases. This implies that their overall business in terms of total customers is yet to grow a lot. But they held top 3 positions due to their immaculate CSR. But they have really performed well in the F.Y to get number 3 positions as compared to the last position of number 8 in F.Y 2016-17.
Now, just take a look at the top positions in terms of average claims paid per customer in 2017-18.
IRDA Claim Settlement per customer for 2017-18 (Data Courtesy IRDA) - arthikdisha.com
Life Insurer
Average Claim settled amount per customer( ₹ Lakh)
Aegon Life
927736
Aviva Life
925000
ICICI Prudential Life
637580
Edelweiss Tokio Life
628333
Canara HSBC OBC Life
616437
Bharti Axa Life
493953
PNB Met Life
482018
Tata AIA Life
472037
Aditya Birla Sun Life
468934
IDBI Federal Life
422753
Kotak Mahindra Life
414787
DHFL Pramerica Life
411014
HDFC Standard Life
392855
Star Union Dai-ichi Life
379214
Max Life
348099
SBI Life
323044
Future Generali Life
284359
India First Life
282718
Shriram Life
276545
Exide Life
237723
Bajaj Allianz Life
236483
Reliance Nippon Life
174839
LIC of India
148324
Sahara Life
97302
Surprisingly, while you analyse in terms of average claims paid per customer during 2017-18, you would find that the previous top 10 positions changed drastically. This implies that here the top 10 companies managed to earn higher average premium per customer. This also may be due to higher risk coverage of the insured's life. Here the claim settlement ration 2017-18 did not work at all.
Now, let's just compare the top 10 lists of companies during 2017-18 and 2016-17 i.r.o Claim settlement ratio for choosing the best plans for you.
So, from the above table, you can see that more or less the following top 5 companies have been a consistent performer for the last couple of years. These are as follows.
- Max Life;
- ICICI Prudential;
- HDFC Standard Life;
- LIC of India;
- Tata AIA Life;
Out of the above 5 best companies, you may research the best-suited plans for your needs which may be lighter on your pocket as well. Don't go for the traditional insurance plans as they are not cost effective and does not provide adequate life risk coverage. On the other hand, if you go for any of the above online term insurance plans even may be offline, it will not only cover you adequately but also would be very much cost effective and a prudent one. By doing so, you can maintain the sanctity of the term insurance products.
Disclaimer: I am neither directly nor indirectly associated with any of the company or products mentioned above. Readers are advised to go through the policy documents carefully before making any buying decision
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