Health Insurance Claim Settlement Ratio

by SMCIB on Tuesday, 28 November 2023

Health Insurance Claim Settlement Ratio

Whenever you purchase any product, right from expensive items like vehicles to everyday items like toiletries, one of the first things you look at is its rating. You go through the product’s reviews, the brand’s ratings, and also talk to other people about their experience with the brand. If you find that the product has a high customer rating and hear positive feedback about it, you feel confident in making the purchase.

So, why not do the same with an important financial decision like Health Insurance? You can assess the credibility and trustworthiness of an insurer by looking at their claim settlement ratio. This metric gives you insights into the probability of your claim being paid out by the insurer.

What does Claim Settlement Ratio exactly mean? How do you calculate it? Let’s discuss - in this article.

What Does Claim Settlement Ratio (CSR) Mean?

Claim Settlement Ratio is a measure that indicates the total number of claims an insurance company has successfully paid out compared to the total number of claims they received in a specific financial year.

Here is the formula to compute the CSR for any insurance company –

Clam Settlement Ratio = (No. of claims settled in a financial year) / (No. of claims received in a financial year + Outstanding claims at the start of the year) X 100.


How Does the Claim Settlement Ratio Help You?

The Claim Settlement Ratio is a crucial element to check the credibility of an insurance company in terms of settling claims. If the Claim Settlement Ratio of an insurance company is high, it means a greater number of claims have been settled by it. For example, an insurance company with a claim settlement ratio between 95% and 97% is more reliable than a company with a lesser ratio.

So, choosing an insurance company with a higher Claim Settlement Ratio will increase the chances of your claim being honoured in the future.

Health Insurance Claim Ratio - Types

Type Meaning Formula Example
Claims Repudiation Ratio

The percentage of claims rejected by an insurance company is referred to as the Claims Repudiation Ratio or Claim Rejection Ratio.

Total number of claims rejected in a year/Total number of claims received in a year x 100

An insurance company received a total of 150 claims in a financial year. It settled 120 claims and rejected the remaining 30 claims. In this case, the Claim Repudiation ratio of the insurance company will be -

Claim Repudiation Ratio = Total claims rejected in a year/Total claims received in a year x 100

= 30/150 x 100 = 20%

Claims Incurred Ratio

Claims Incurred Ratio is the ratio of net claims settled by an insurance company to the net premiums collected during a fiscal year. It is essentially a comparison between the money received as premiums and spent on claims by the insurer in a financial year.

Net claims settled/Net premiums collected x 100

An insurance company collected Rs. 5 Lakhs in premiums out of which it spent 4 Lakhs to settle the claims in a financial year. So, its Claim Incurred Ratio will be -

Claim Incurred Ratio = Net claims settled/Net premiums collected x 100

= 4 Lakhs / 5 Lakhs x 100 = 80%

Claim Pending Ratio

The percentage of pending or outstanding claims with the insurance company is calculated using Claim Pending Ratio.

Total number of pending claims/Total number of claims received x 100

For example, say an insurance company received 80 claims in a year out of which 20 claims remain pending. So, its Claim Pending Ratio will be -

Claim Pending Ratio = Total number of pending claims / Total number of claims received x 100

= 20/80 x 100 = 25%


Advantages of Good Claim Settlement Ratio

To make an informed decision while buying health insurance, it is crucial to analyse the Claim Settlement Ratio of an insurance company. It is one of the most dependable points of assessment.

An insurance company with a higher Claim Settlement Ratio shows that it's more credible, trustworthy, and financially sound. You can rely on them without being worried about whether your claim will be executed in the future, after investing your money in the plan.

The advantages of having a higher Claim Settlement Ratio are -

  1. Greater Reliability

    The higher the Claim Settlement Ratio of any insurance company, the higher the claims it settles in a fiscal year. This is a sort of ‘stamp of approval’ for the company’s ability to provide financial support in times of adversity.

  2. Hassle-Free Services

    An insurance company with a good Claim Settlement Ratio ensures that you can avail of the claim in a quick and trouble-free manner.

  3. Commitment To You!

    Any insurance company with a higher Claim Settlement Ratio also shows its commitment to serving its customers during financial emergencies and protecting them.


Health Insurance Claim Settlement Ratio

The end goal of any health insurance policy, especially for the customer, is to receive the claim amount when they need it. You can measure the claim-settling ability of an insurance company by looking at its health insurance claim settlement ratio.

The health insurance claim settlement ratio is basically a metric that calculates the ratio of the total claims settled to the total number of claims received by an insurance company in a given financial year.

You can check the claim settlement ratio of any insurance company on the company’s website or in the annual report released by IRDAI.

To calculate the Claim Settlement Ratio of any insurance company, a simple formula is used -

Claim Settlement Ratio = (Number of claims settled) / (Number of claims received + Outstanding claims at the beginning of the year) X 100

Let’s understand this better with an example. Say an insurance company received 50 claims during the fiscal year 2022 and they had 10 outstanding claims at the beginning of the year. Out of these, they settled 51 claims.

In such a case, the claim settlement ratio will be = 51/ (50+10) x 100

= 51/60 x 100

= 85%

This means the insurance company has a Claim Settlement Ratio of 85%.

The Significance of CSR in Health Insurance

The Claim Settlement Ratio plays a vital role in evaluating an insurance company's credibility when it comes to handling claims. A higher CSR indicates that more claims have been settled by the insurer. This reflects positively on the insurer's reliability and dedication towards its customers.

You should also be aware that assessing an insurance company's performance based on a single year's CSR may not provide a complete picture. To obtain a more accurate assessment of their claims settlement track record, it is advisable to examine CSR data spanning multiple years. A comprehensive review of the past 4-5 years can reveal consistent trends and patterns in their claims settlement performance, helping you make an informed decision.

However, it is essential to recognise that CSR is just one aspect of the whole picture. While it is a valuable metric, it should not be the sole determinant when selecting a health insurance policy. You should also take into account other factors like the speed at which claims are processed and settled. An insurer may have a high CSR but might take a longer time than expected to settle claims. Another thing you should consider is the number of complaints the insurer receives regarding claims. A high CSR may lose its significance if there is a substantial volume of complaints regarding claim denials or disputes.


What Does Incurred Claim Ratio Mean?

The Incurred Claim Ratio (ICR) is a measure that shows the proportion of net claims paid out by the insurer against the net premiums it has received in a specific financial year. In simple terms, it helps you figure out whether an insurer is paying out more in claims than they are collecting in premiums.

To calculate an insurance company's Incurred Claim Ratio, you can use this straightforward formula –

Incurred Claim Ratio = (Net Claims Incurred / Net Premium Earned) x 100

Updated Health Insurance Claim Settlement Ratio: CSR and Incurred Claim Ratio

Here is the updated health insurance claim settlement information for general and health insurance companies. The table below displays the data for the Claim Settlement Ratio (CSR) and the Incurred Claim Ratio (ICR), based on the public disclosure data for June 2023-24 of the respective insurance companies –

Insurance Company

Claim Settlement Ratio

Incurred Claim Ratio

Acko General Insurance Co. Ltd



Aditya Birla Health Insurance Co. Ltd



Bajaj Allianz General Insurance Co. Ltd



Care Insurance Health Insurance Co. Ltd



Cholamandalam MS General Insurance Co. Ltd



Future Generali India Insurance Co. Ltd



Go Digit General Insurance Co. Ltd



HDFC Ergo General Insurance Co. Ltd



ICICI Lombard General Insurance Co. Ltd



IFFCO Tokio General Insurance Co. Ltd



Kotak General Insurance Co. Ltd



Liberty General Insurance Co. Ltd



Magma HDI General Insurance Co. Ltd



ManipalCigna Health Insurance Co. Ltd



National Insurance Co. Ltd



Navi General Insurance Co. Ltd



New India Assurance Co. Ltd.



Niva Bupa Health Insurance Co. Ltd



Oriental Insurance Co. Ltd



Raheja QBE General Insurance Co. Ltd



Reliance General Insurance Co. Ltd



Royal Sundaram General Insurance Co. Ltd



SBI General Insurance Co. Ltd



Shriram General Insurance Co. Ltd



Star Health and Allied Insurance Co. Ltd



Tata AIG General Insurance Co. Ltd



United India Insurance Co. Ltd



Universal Sompo General Insurance Co. Ltd



Zuno General Insurance Co. Ltd




How Can You Check The Health Insurance Claim Settlement Ratio?

Determining an insurance company's claim settlement ratio (CSR) is quite straightforward and here are 3 ways to do it –

Method 1: Visit the Insurance Company's Website
Most insurance companies provide information about their claim settlement ratio on their official websites. You can easily find this information there.

Method 2: Refer to IRDAI Annual Report
The IRDAI publishes an annual report containing details about the claim settlement ratios of insurance companies. You can access this report on the official IRDAI website.

Method 3: Calculate it Yourself
You can also calculate the CSR yourself. First, collect the data of the number of claims settled, number of claims received, and the outstanding claims at the beginning of the year. You can find this data in the public disclosures made by insurance companies on their websites.

Next, incorporate the data in the following formula –

Claim Settlement Ratio = (Number of claims settled) / (Number of claims received + Outstanding claims at the beginning of the year) x 100.


Claim Settlement Process of Health Insurance

Health insurance claims are processed and settled in two different ways -

  1. Cashless Claims
    These claims come into play when you receive medical treatment at a hospital that is part of your insurance company's network. A network hospital is one that has a tie-up with your insurance provider. If you choose a hospital from your insurer's list of approved cashless hospitals, they will settle your medical expenses directly with the hospital.

  2. Reimbursement Claims
    Under this option, you will initially need to pay the expenses for your medical treatment upfront. Then, you can file a reimbursement claim with your insurance company. After the verification process, they will reimburse the costs you’ve incurred, according to the terms and conditions specified in your policy.
  3. Let’s look the claim settlement process in detail –

    ?Cashless Claim

    Step 1: Eligibility Check
    The very first and crucial step is to verify your eligibility for a cashless claim. This is particularly important for medical conditions that are typically covered after a waiting period of 2 to 4 years.

    Step 2: Cashless Service Availability
    You should confirm whether your insurance company offers cashless services at the hospital where you plan to receive treatment.

    Step 3: Check the Hospital Provider
    If your chosen hospital is on the list of excluded providers, a cashless claim will not be possible. If it is not on the list of excluded providers, check with the hospital administration whether they accept cashless payments from your insurer.

    Step 4: Understand Your Policy
    It is crucial to properly understand the limits and conditions of your insurance policy. Check whether your coverage has any financial restrictions, like caps on room rent, ICU charges, or limits on specific diseases and treatments. This is especially important for planned medical procedures. And, verify whether your policy covers non-consumable items. If so, find out if there is a specific list of items it will not cover. This way, you can estimate any potential out-of-pocket expenses.

    Step 5: Keep the Necessary Documents At Hand
    To ensure a hassle-free cashless claim process, make sure you have all these documents ready –

  • Health card issued by the insurer or the policy copy
  • Policyholder’s name
  • KYC related docs (like PAN card/Aadhar card/passport-size photo) of the proposer
  • Patient’s ID proof
  • KYC documents of the insured person
  • Policy number
  • Name and address of the insured individual for whom the claim is being filed
  • Name along with the address of the attending medical practitioner
  • Proposed admission date
  •  Information about the illness or injury and the required treatment or surgery
  •  Past medical history, both related and unrelated to the present ailment. If there are any differences from the information you disclosed at the time of policy purchase, you may face claim rejection.
  •  Police FIR (in case of accidents)
  • If you don’t possess these essential documents, your cashless claim may get rejected, which might require you to pay the bills upfront and then seek reimbursement. Therefore, it is crucial to keep all the necessary paperwork handy to avoid any inconvenience during the claim process.

    Step 6: Timely Notification
    For planned hospitalisation, it is essential to initiate a claim at least 3-4 days before your date of admission. In cases of emergency hospitalisation, this request should be made within 24 hours of admission. The hospital will need specific details and documents from you to initiate a pre-authorisation request with your insurer for cashless claim approval.

    Step 7: Prepare for Possible Advance Deposit
    Sometimes, the pre-authorisation process can take anywhere from 6 to 24 hours, depending on your insurance company. They may also have queries that require your timely responses.

    During this period, the hospital might request an advance deposit, which your insurer will reimburse later on. To prevent any financial stress, it is better to have an emergency fund set aside for such advance payments.

    It is also important to keep in mind that any medical expenses incurred before your hospitalisation will need to be claimed separately from your insurer. As a result, it is wise to hold onto all the original prescriptions, bills, receipts, and reports (including any medical imaging films) that led to your hospitalisation. This will pave the way to a smoother claims process for those expenses.

    Step 8: Follow Up the Processing of Your Claim
    Once your discharge date is confirmed, the hospital's insurance desk will notify your insurer and submit all the necessary paperwork, including your final bill and discharge summary. Your insurer might send you updates about your claim's progress through your registered mobile number or email. However, there could be instances where the hospital may fail to inform the insurer about your discharge or send the required documents and this may lead to delays in the approval process.

    Therefore, it is vital to stay informed about your claim's status. Make sure to regularly check for communication from your insurer. Generally, the approval process is completed within 2-6 hours after your insurer is informed of your discharge. They may also have questions that require timely responses. To ensure a swift settlement of your claim, it is crucial to follow up on the claim process with your insurer.

    Step 9: Review the Final Bill and Approval Letter
    Once you have the final bill and approval letter in hand, you should examine them closely. This will help you understand which expenses are approved and which aren't. If you have any questions or doubts, do not hesitate to get in touch with your insurer for clarification.

    Be sure to carefully review the approval letter, as it might specify expenses that should not be billed to the patient. Please refrain from making payments for any such designated expenses.

    Apart from these specified expenses, there may be other unapproved costs. And, you will be responsible for covering these expenses from your own pocket before you leave the hospital.


    ?Reimbursement Claim

    Step 1: Verify if the Hospital is an Excluded Provider
    Before seeking treatment at a hospital that is not in your insurance network, check whether it is on the list of excluded providers. If it is, your claim will not be accepted, and you will need to select a different hospital. You can confirm this by reaching out to your insurance company via their toll-free number, email, or SMS.

    Step 2: Notify Your Insurance Company
    Within 24 hours of admission, inform your insurer about your hospitalisation. You can find the contact information you need on your policy document or the insurer's website.

    Step 3: Gather All Hospital Documents
    Once your treatment gets over, it is essential to collect all the original documents from the hospital before your discharge. These documents include –

  1. Original receipts and invoices
  2. Discharge summary
  3. The claim form, part of which needs to be filled out by the hospital
  4. Medical reports, which may include MRI or X-ray films
  5. Doctor prescriptions for all the payments you have made
  6. Ensure that you double-check the patient's name, gender, and age on all these documents, correct any errors and keep everything organised in a file. If possible, request a detailed bill that breaks down all the costs from the hospital. Additionally, request a copy of the case sheet/ indoor case papers and hospital's registration certificate if the non-network hospital is willing to share them.

    Step 4: Prepare All Documents
    Before making a reimbursement claim, it is essential to ask your insurer the list of documents to be submitted.

    Here's a list of the documents needed –

  • Health card or policy copy
  • KYC documents of the proposer
    • PAN card
    • Aadhar card
    • Passport-size photo
    • Bank statement with bank’s name, a/c number, and IFSC code, or a copy of the bank passbook with the latest transaction page, or an original cancelled cheque with your name on it
  • Patient's ID proof
  • A filled and signed claim form
  • All relevant documents, such as test reports, films, receipts, and medical prescriptions related to the treatment
  • The original discharge summary from the hospital
  • In cases involving implantation (e.g., knee replacement or cataract claims), include the IOL sticker and invoice from the hospital
  • Note: The list of documents needed for claim settlement may differ across insurers.

    Step 5: Fill Out the Claim Form
    Once you have all the required documents, you can initiate your reimbursement claim. You will need to complete the claim form accurately and submit it along with the necessary documents to your insurer.

    Step 6: Submit the Documents
    Apart from your hospitalisation bills, you can also include any pre or post-hospitalisation bills along with the prescriptions and reports. This ensures that any eligible expenses are not overlooked.

    Step 7: Obtain an Acknowledgment
    Make sure to keep copies of all the original documents you provide to the insurer. Also, obtain an acknowledgment from the insurance company or third-party administrator (TPA) for the submission of original documents.

    Step 8: Monitor Claim Progress
    After you have submitted your claim, it is essential to stay updated on its progress with your insurer. They will assess the claim and may sometimes request extra information or documents that need to be promptly provided for a speedy settlement.

    Step 9: Review the Claim Settlement Summary
    Once the process is completed, the approved amount will be deposited into the bank account you’ve specified. You will receive a settlement summary that details all the deductions made. Carefully examine these deductions, and if you have any questions or concerns, contact your insurer.

    Reasons for Claim Rejection
    Claim rejection can happen for various reasons, like –

  1. Providing incorrect or misleading information when applying for health insurance. This can have serious consequences. If the insurer discovers discrepancies during the claims evaluation process, your claim may be denied.
  2. Your insurance policy comes with waiting periods, which are specific timeframes during which you cannot make a claim. Three main types of waiting periods include -
    • The initial waiting period, which lasts for 30 days from the date of policy’s issuance. You will not be able to make a claim for any injury or ailment, except for accidents.
    • The pre-existing disease waiting period, which generally spans from 2 to 4 years. Any disease that you’ve had in the 4 months prior to buying health insurance is considered as a pre-existing disease and will not be covered during this time span.
    • The specific disease waiting period, also typically lasting 2 to 4 years. These exclusions are determined by the insurer and aren’t dependent on your  current health status.

  3. If you make a claim for any condition or disease excluded by your policy, the same will not be honoured. Say Ashika has a big scar on her face that she decides to remove through a cosmetic surgery. The surgery costs around Rs. 75,000, but her health insurance will not cover it because the procedure falls under the policy's exclusions.
  4. Errors and oversights during the claims process, such as inaccuracies on forms, missing required documents, or failing to adhere to the insurer's specified deadlines for document submission, can lead to claim rejections.
  5. If you miss out on renewing your health insurance in a timely manner, it can result in a coverage lapse. During this lapse, any claims you submit are at risk of being rejected.


The claim settlement ratio is a good indicator of an insurance company’s reliability - in times of need. A company with a higher claim settlement ratio is considered a good choice as it lessens the chances of your claim getting rejected. So, it’s wise to compare the health insurance claim settlement ratios of various insurance companies before purchasing a plan.


  1. Which health insurance provider boasts of the top Claim Settlement Ratio?
    As of June 2023, Aditya Birla Health Insurance Company Limited leads the pack with a Claim Settlement Ratio of 90.24%.

  2. What exactly is a Health Insurance Claim Settlement Ratio?
    The health insurance Claim Settlement Ratio represents the ratio of total number of settled claims to total claims received by an insurance company in a financial year.

  3. How can you calculate the Claim Settlement Ratio?
    To compute the Claim Settlement Ratio (CSR), here is a simple formula

    CSR = (Number of settled claims by insurer) / (Number of claims received by insurer + Outstanding claims at the start of the year) x 100.
  4. What is the time taken for claim settlement by insurance companies in India?
    According to Regulation 27, the stipulated time frame set by IRDAI for settling claims is within 30 days from the receipt of the final ‘necessary’ document.

  5. What are the reasons for claim rejection by insurance companies?
    Insurance companies may decline claims for several reasons, such as failure to disclose essential information, policy lapses due to missed premium payments, denial based on waiting periods for specific conditions or treatments during that specific time span,  non-compliance with policy terms and conditions, etc.

  6. Where can you access information about Health Insurance Claim Settlement Ratios?
    Most insurance companies offer details about their Claim Settlement Ratios on their official websites. Additionally, the IRDAI publishes an annual report that includes data on Claim Settlement Ratios for various insurance companies.

  7. Is it always necessary to opt for a company with a high Claim Settlement Ratio?
    No, when selecting an insurance company, do not base your decision solely on the CSR. It is essential to take into account other factors, such as the time taken for claim processing and settlement. An insurer might boast of a high Customer Settlement Ratio (CSR) but still be slow in handling and finalising claims. Similarly, a large number of complaints regarding claims can diminish the significance of a high CSR.

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