When buying any insurance policy health insurance, life insurance, or term insurance one of the most important factors you must check is the Claim Settlement Ratio (CSR). It directly shows how reliable an insurance company is at the time of claim.

In this blog, we will explain what claim settlement ratio is, why it matters, and how to use it to select the best insurance company in India.

What Is Claim Settlement Ratio?

Claim Settlement Ratio is the percentage of claims settled by an insurance company against the total number of claims received in a financial year.

Formula:

Claim Settlement Ratio = (Total Claims Settled ÷ Total Claims Received) × 100

For example, if an insurer received 10,000 claims and settled 9,600 claims, the claim settlement ratio would be 96%.

A higher claim settlement ratio indicates that the insurer is more trustworthy and efficient in handling claims.

Why Claim Settlement Ratio Is Important?

The real value of insurance is realized only at the time of claim. A policy with low premium but poor claim settlement history can create stress during emergencies.

Here’s why CSR matters:

• Shows credibility of the insurance company


• Indicates speed and fairness in claim approval


• Reduces risk of claim rejection


• Helps choose a safe and reliable insurer


• Builds trust during medical or financial emergencies

When comparing insurance policies, claim settlement ratio should always be checked along with coverage and benefits.

Ideal Claim Settlement Ratio: What Is Considered Good?

• Above 95% – Excellent


• 90% to 95% – Very Good


• Below 85% – Risky, needs careful evaluation

However, CSR should never be the only deciding factor. You must also consider claim process, exclusions, waiting periods, and customer service.

Claim Settlement Ratio in Health Insurance vs Life Insurance

Health Insurance Claim Settlement Ratio

In health insurance, CSR reflects how smoothly cashless and reimbursement claims are processed. A good CSR ensures less hassle during hospitalisation.

Life Insurance Claim Settlement Ratio

In life insurance, especially term insurance, CSR indicates whether the nominee will receive the claim amount without complications after the policyholder’s death.

Both are equally important, but life insurance CSR is often considered more critical due to the large claim amount involved.

Claim Settlement Ratio vs Claim Rejection Ratio

Many people confuse these two terms:

• Claim Settlement Ratio shows how many claims were approved


• Claim Rejection Ratio shows how many claims were rejected

A high claim settlement ratio generally means low rejection ratio, but rejection can also happen due to:

• Non-disclosure of facts


• Policy exclusions


• Waiting period not completed


• Incorrect documents

Always read policy terms carefully before buying.

Where to Check Claim Settlement Ratio?

You can check official claim settlement data from:

• IRDAI annual report


• Insurance company’s official website


• Trusted insurance advisors and brokers And at PolicyHub IMF Pvt Ltd, we help you analyze claim settlement performance, policy wording, and claim support quality before you buy.

Is Claim Settlement Ratio Enough to Choose Insurance?

No, Claim Settlement Ratio (CSR) is important, but it should always be evaluated along with other critical factors. These include the availability of network hospitals, a smooth cashless claim process, faster claim turnaround time, clear policy exclusions, reasonable waiting periods, genuine customer reviews, and reliable 24×7 claim assistance. Sometimes, an insurance company with a slightly lower CSR but strong claim support and service quality can prove to be a better and more dependable choice during emergencies.

Role of Insurance Advisor in Claim Settlement

A professional insurance advisor plays a crucial role during the claim process by guiding customers at every step. From helping with correct document submission to coordinating with the insurance company and TPA, an advisor ensures the claim process runs smoothly and efficiently. Their expertise helps in faster claim approval and significantly reduces the chances of claim rejection due to errors or missing information. PolicyHub IMF Pvt Ltd provides complete end-to-end claim support, giving customers peace of mind and reliable assistance during critical and stressful times.

Final Thoughts: Claim Settlement Ratio Matters, But Support Matters More

Claim Settlement Ratio is one of the most important parameters while choosing an insurance policy, but it should not be considered alone. A balanced approach combining CSR, policy benefits, and professional claim assistance ensures complete protection.

Before buying any insurance policy, always compare claim settlement history and choose a trusted advisor who stands with you at the time of claim.