Claims settlement: LIC fares better than private insurers

Life Insurance Corporation of India has performed better in terms of claims settlement ratios as compared to private life insurance companies, according to the IRDA annual report.

“The claims settlement ratio of LIC was better than that of the private life insurers. Settlement ratio of LIC increased to 97.03 per cent during the year 2010-11 when compared to 96.54 per cent during the previous year,” the IRDA said in the report.

The percentage of claims rejected by LIC stood at 0.01. The ratio of claim rejections to total reported claims declined from 1.21 per cent in the previous year to 1 per cent in 2010-11.

Compared to LIC, private insurers rejected a large number of claims.

The per cent of claims rejections increased to 8.90 per cent in 2010-11 from 7.61 per cent in 2009-10.

Overall, the life insurance industry's settlement ratio has improved slightly to 95.58 per cent in 2010-11 from 95.24 per cent in 2009-10, and the claims rejection ratio has also gone up to 2.04 per cent in 2010-11 from 1.93 per cent in 2009-10.

Life insurers settled over 50 lakh maturity claims in 2010-11, paying a total of Rs 32,345 crore and the number of survival benefits paid in the year was over 1.35 crore for an amount of Rs 19,816 crore.

deepa.n@thehindu.co.in