How many health insurance advertisements do you come across on television, social media, YouTube, and your browsers? Considering the increased initiatives to boost health insurance penetration across the country, 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 the incurred financial chasms?

You need more than one factor to help you make this choice. However, one crucial parameter in this aspect is the Claim Settlement Ratio (CSR). This reflects the credibility of an organization, 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.

What is Claim Settlement Ratio 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 x 100 / Total no. of Claims Received

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.


Top Claim Settlement Ratio Health Insurance Companies 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.

Here is a quick look at the top-scoring health insurers across the market -

Health Insurance Providers Claim Settlement Ratio (CSR)
HDFC Ergo 97%
Care 95.2%
Bajaj Allianz 94.51%
Niva Bupa 90.68%
ICICI Lombard 85.69%

Why is Claim Settlement Ratio 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, hence pointing out the provider's credibility.

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 are seeking a -

  1. The Cashless mode in a partner hospital
  2. Reimbursement mode in a non-partner hospital
  3. 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 go ahead with 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 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:

  1. 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 is Claim Settlement Ratio?

Claim settlement ratio is the ratio between the number of raised claims settled by an insurance provider against the total number of claims raised for the insurer in a single financial year.

What is the difference between Claim Settlement Ratio & Incurred Claim Ratio?

Claim settlement ratio indicates the trust that can be placed in the hand of an insurance company as it shows the % of settled cases in a FY. Whereas the Incurred claim ratio indicates the long term financial stability of the company as it shows the amount of claim settled in a year against the premium collected. 

Which health insurance company had the highest Claim Settlement Ratio in 2023?

HDFC Ergo is the health insurance company with the highest Claim Settlement Ratio or CSR of 97% in 2023.