How many health insurance advertisements are on television, social media, YouTube, and your browsers? Considering the increased initiatives to boost health insurance penetration nationwide, such swimming loads of marketing aren’t uncommon.
However, as palpable as the marketing venture is for the health insurance providers, such endorsements confuse potential policyholders. With the buffet of health insurance providers and their policies available with them, which insurer should be your choice? Which insurance provider guarantees credibility devoid of their marketed appearance? Which health insurance company will support you the best when you are going through your worst nightmare of health scares and incurring financial chasms?
You need more than one factor to help you make this choice. However, the Claim Settlement Ratio (CSR) is a crucial parameter in this aspect. This reflects the credibility of an organisation, its payout capabilities, the overall risk management capability of the insurer, and more.
Thus, as you shop around for a new health insurance policy, one of the first things you need to know is CSR. You need to know how it is calculated, what it means to you as a policyholder, what its disadvantages are, and what are some of the best health insurance companies in India with the highest CSR.
Top Health Insurance Providers with High Claim Settlement Ratios (CSRs)
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What is the Claim Settlement Ratio (CSR) in the Health Insurance Industry?
The ratio between the number of claims resolved by a particular insurance company against the total number of claims raised for that specific insurance provider (over one financial year) multiplied by 100. This ratio is subject to change and is released by the IRDAI (Insurance Regulatory and Development Authority of India) each financial year.
Claim Settlement Ratio = Total no. of Claims Approved / Total no. of Claims Received x 100
So, if 100 claims had been raised for a health insurance company and 96 of them had been resolved, then the CSR for the company for that year would be 96%. So, this ratio indicates the number of claims resolved by the insurer.
Hence, based on this, the CSR of a health insurer holds great importance for both potential policyholders and the insurance industry in general.
Why is Claim Settlement Ratio (CSR) important?
The Insurance (IRDAI) releases the Claim Settlement Ratio to offer potential and existential policyholders a comprehensive idea about the claim settlement performance of a health insurer. This would help them choose their ideal health insurance provider and a suitable health insurance plan.
Here is a look at some reasons why Claim Settlement Ratio is considered so important -
- Reflects the credibility of the health insurance provider
One of the most crucial questions potential policyholders have while choosing their health insurance company is: “Will this insurer settle my claims?”
For policyholders, this is a crucial determiner to ensure the credibility of a health insurance company. With a CSR, individuals can get an idea about the number of claims settled by an insurer over a year, pointing out the provider's credibility.
2. Provides insight into an insurer’s consistency across the claim settlement process
With CSR as a record, health insurance providers can’t be inconsistent in their payouts. They must maintain their claim settlement approach and assurance for all of the claims raised, or this gets reflected in the ratio.
This means that you, as policyholders, have the much-required financial assurance of a payout whether you seek a -
- The Cashless mode in a partner hospital
- Reimbursement mode in a non-partner hospital
- Acts as a great metric to compare various health insurers
Say you are looking for a health insurance policy for portability or for purchasing a new one altogether.
So, you either approach an insurance advisor or use our health insurance comparison tool. Now, in both these cases, one of the criteria that will stand out as a parameter of comparison is - the Claim Settlement Ratio. The higher the CSR, the better the insurer. (However, please remember that this isn’t the only criterion that decides the best health insurance policy provider).
Now, while the aforementioned pointers on the benefits of the Claim Settlement Ratio surely showcase its importance for policyholders, there are certain downsides of the ratio that needs to be considered.
What are the disadvantages of the Claim Settlement Ratio (CSR) in Health Insurance?
While CSR is an important metric to filter out the suitable insurance companies to buy your policies from, it should not be the only determining factor. The ratio fails to indicate a few important things:
- The time invested in settling the claim
While CSR shows how many claims have been settled by the insurance provider, it leaves little scope for the policyholder to gauge the time required to pay the raised claim.
Now, it is true that the IRDAI has set a particular span of 30-45 days to resolve the raised claim. However, the faster the claim settlement process is done, the better suited it is as your insurance provider. With this data hidden from sight, potential policyholders are on the back foot.
2. The financial strength of an insurance company
Claim Settlement Ratio reflects the frequency of claim settlement from the health insurance provider’s point of view. However, it does not indicate the financial stability of the insurance provider that will enable the company to continue with its services, maintain its CSR, and stay as one of the industry's most credible health insurance providers.
3. Amount of claims settled against each claim
Unfortunately enough, the Claim Settlement Ratio of a health insurance provider does not showcase what percentage of the claim amount was resolved by the provider.
For example, say a claim was raised for INR 5 lakhs. However, the health insurer paid off only INR 3 lakhs due to some exclusions or exemptions. While the CSR would show this case as a claim settled, it wouldn’t reflect that the insurer made a copayment.
This blind sighting makes the ratio not the sole factor determining your choice of a health insurance company. Rather, when choosing your health insurance provider, factor in -
- CSR (Claim Settlement Ratio),
- ICR (Incurred Claim Ratio),
- Extensive product portfolio
- Impressive track record
- Proactive customer dealing
- A long list of network hospitals
What are the best health insurance policies from the top health insurers in India?
While the claim ratio of health insurance providers, as published by the IRDAI, varies from one financial year to the other, some providers have managed to stick to the top. Subsequently, the health insurance plans offered by them are also premium and in demand across the industry.
However, when deciding the top health insurance provider, CSR can’t be the sole metric to consider. You need to take into account the Incurred Claim Ratio (ICR), the complaint volume, and the number of network hospitals involved.
Based on such factors, here is the list of the final top health insurance providers and some of the best plans offered by them -
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