Living a happy life is the same as being healthy. The most important factor for all of us is our health, which is a resource. So much so that purchasing health insurance is among the most crucial financial choices anyone ever makes. Such regulations ensure that, especially in a time when hospitalisation costs are rising daily, medical emergencies do not cause financial upheavals.
However, it’s important to compare health insurance plans in order to get the best one when looking for a medical insurance plan. When choosing health insurance in India, a person must take a lot of aspects into account. It comprises the claims process, hospitals in the insurer’s network, insurer quality, insurance benefits, bonuses, etc. Yet, one aspect of health insurance that policyholders frequently neglect is the claim settlement ratio.
So, what exactly is the health insurance plan’s claim settlement ratio? Let’s investigate by reading further on.
Claim Settlement Ratio Definition (CSR)
The percentage of paid claims to claims filed with an insurer is known as the claim settlement ratio, or CSR, in a health insurance policy. It is a typical metric for rating insurance providers and one of the main factors that policyholders take into account when selecting an insurer. *
The Insurance Regulatory and Development Authority of India determines the CSR at the beginning of each year (IRDAI). Also, the organisation releases yearly data on the registered insurance companies’ most recent health insurance claim settlement ratios. # *
Simply expressed, the CSR of health insurance company A will be 100% if it settles all of the claims made by its policyholders within a year. However, business B’s CSR will be 80% if it settles about 80% of the claims made by its policyholders and rejects about 20% of the same. *
In what way is the claim settlement ratio (CSR) is calculated?
The CSR of a registered insurance firm in the nation is determined by IRDAI using a certain methodology. Using the formula, CSR equals the sum of all claims resolved, and all claims received multiplied by 100. *
The outcome is shown as a percentage. For instance, if an insurance provider’s CSR is 80%, this means that 80 out of every 100 claims made by policyholders are resolved and paid for by the provider. *
It should be noted that CSR is determined by the types of health insurance plans provided by an insurance firm, not simply life insurance policies.
Why should policyholders take the claim settlement ratio into consideration?
The importance of a life or health insurance policy rests in the guarantee that the insured or their beneficiaries will be able to file a claim for receiving the insurance coverage in the event of an unpleasant circumstance, such as a medical emergency.
Yet, there are a few situations in which the insurer may refuse to pay a claim. This can be the result of the policyholder providing inaccurate information on the application forms, concealing medical histories when applying for a life insurance policy or health insurance plans for the family, etc.
Advantages of a health insurance plan’s claim settlement ratio *
- If an insurer has a CSR of 80% or more, you may be certain that you can fully rely on them, and they will handle and pay out the claim filed by your beneficiaries while you are away.
- With a good CSR, your family members won’t have to worry about hustling all day and all night to get their claims paid.
- If you can compare the CSRs of several health insurance providers, opt for a few of the top ones that provide not just a higher CSR but also well-regarded services.
* Standard T&C Apply
# Visit the official website of IRDAI for further details.
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