Death Claim Settlement Ratio Of Life Insurers In Year 2015-2016

Death Claim Settlement Ratio Of Life Insurers In Year 2015-2016

IRDA Updates, Life Insurance

On 15/12/2016 Insurance Regulatory and Development Authority of India (IRDAI) have published its annual report for the year 2015-2016. Along with all the other data related to life insurers, general insurers, and health insurer, IRDAI has also published the data related to individual death claim settled by all the 24 Life Insurance companies in the year 2015-2016.

Individual death Claim Settlement Ratio of Life Insurers 

Death claim settlement ratio is the percentage of claim settled by a life insurer out of the total claim raised in a particular year. In the year 2015-2016, the industry average of death claim settlement ratio was 97.43% in numbers and 91.32% in amount. This year both the ratios are increased by.46% compared to 96.97% of last year in numbers and .41% increase in the amount paid compared to 90.91% of last year.  In the financial year, 2015-2016 claim settlement ratio for private life insurers was 91.48% for numbers of claim settled, while 79.60% of claimed amount paid by private life insurers. Claim settlement ratio of the state-owned insurer, Life Insurance Corporation of India (LIC) was 98.33% of the number of claim paid and  95.59% of claimed amount paid in the year 2015-2016.

Life insurers having claim settlement ratio above industry average

In the year 2015-2016, the industry average of death claim settlement ratio was 97.43% in numbers and 91.32% in amount. Let us see how many companies were above the industry average:

In number of Claim settled in the year 2015-2016: Industry average- 97.43%

  1. Life Insurance Corporation of India (LIC): 98.33%

In Claimed amount settled in the year 2015-2016: Industry average- 91.32%

  1. Life Insurance Corporation of India (LIC): 95.59% (Rs. 9690.17 Crore)
  2. Tata AIA: 94.24% (Rs. 87.09 Crores)
  3. Aegon Religare: 94.16% (Rs. 40.15 Crores)
  4. Max Life: 93.19% (Rs. 261.91 Crores)
  5. Canara HSBC OBC: 91.37% (Rs. 30.05 Crores)

Claim settlement data of other life insurers is given below

Individual death claims for the year 2015-2016 (Number wise)

Individual death claims for the year 2015-2016 (Amount wise)

How does death claim ratio help policyholders?

Ultimate motive of buying a life insurance by a customer is to provide a financial security to his/her dependent after the untimely demise of the life assured. Death claim ratio provides a view about a insurer’s ability to pay the claim and its ratio of rejection of the claim.

  • Though the majority of claims which are repudiated are due to suppression of material facts by the life assured at the time of taking policy, but higher rejection ratio reduces the credibility of the insurer and put a question mark on its underwriting practices. 
  • A low rejection and outstanding in number but higher in amount show that an insurer is not able to pay claims of higher sum assured policy on time.
  • A Higher percentage is also not enough to compare insurer, life assured must also compare that what is the total amount the insurer is paying in that particular year and the total amount of claim arisen. Higher the amount higher the policies are being serviced by the insurer.

Though this ratio helps the policyholder to choose a good life insurer for taking a life insurance policy but this is not the only thing that a policyholder should rely on, he/she must also consider various factors like, insurers reputation in market, number of branches, servicing aspects, convenience of depositing premium and ultimately the conditions of the policy which they are buying.

 To download the full annual report of IRDAI please Click Here

All you need to know about sites comparing insurance products

All you need to know about sites comparing insurance products

General Insurance, IRDA Updates, Life Insurance

You might have come across many websites which are comparing the insurance plans premiums and collecting data about the interested person through their online portals. These sites are called Web Aggregators.

“Web Aggregator” – For the purpose of these guidelines, a web aggregator is a Company registered under Companies Act, 1956 (1 of 1956), approved by the Authority under these guidelines, in whose behalf a website offers information pertaining to insurance products and / or price comparisons of products of different Insurers.-IRDA(Web Aggregators) Regulations, 2013

Do you know that all the sites which are working as Web aggregators have to be registered with IRDA and only after the approval of the IRDA any website can work as Web Aggregators? A Web Aggregator cannot be an insurance agent.

You can find the list of IRDA approved web aggregators at the end of this post, as published by IRDA on 24/08/2016 on its websites.

IRDA has laid down the regulations about the Web Aggregators called as IRDA(WebAggregators) Regulations, 2013; these regulations are about the registration process, lead generations, affiliation with insurers, the number of insurers that an aggregator can work with, sharing of information collected through websites with insurers and many others.

As per the regulations a Web Aggregator has to follow these points:

  1. Web aggregator shall display on the website the premium rates and Key Features of the insurance products of all the Insurers for each class of insurance business.
  1. The price comparisons that are displayed shall be up to date and reflect a true picture of the products.
  1. If you have provided your information on a web aggregators site but didn’t show your interest in any particular insurance product/company, then a web aggregator can share your information with maximum up to 5 insurers in same insurance class (life/nonlife/health). He can also share your information in these case to any insurance broker but not to both.
  1. Web aggregator has to transmit the data of clients to Insurer/Broker:
    1. within five days of the client’s visit to the website.
    2. must be secured from unauthorized access and misuse;
    3. with a reasonable level of suitability, reliability, and correctness;
    4. in compliance with generally accepted security procedures;
  1. Web aggregator can only transmit any leads generated through clients visiting their sites
  2. If a lead was given to an insurer/broker convert into a sale then insurer/broker pay the remuneration to web aggregator which is not more that 25% of the first-year premium.

Obligations of web aggregators

  1. Web aggregator should display the particulars of the validity of approval obtained from the IRDA on its website.
  2. Web aggregator must state clearly and unequivocally that insurance is the subject matter of solicitation.
  3. At no point of time of its functioning, a web aggregator shall have net worth below rupees fifty lakhs
  4. At no point of time of its functioning, a web aggregator shall have the referral arrangement with any Insurer.
  5. Web aggregator shall maintain the records and the reports of its activities under the agreement with insurer / broker, in the manner specified in the agreement entered into between the insurer / broker and the web aggregator.
  6. Web aggregator shall along with its employees (whatever their designation may be) comply with all the provisions of the Act, the IRDA Act, 1999, the rules and regulations framed thereunder and such other directions issued by the IRDA from time to time.

You can find the list of approved Web Aggregator below:

 

Death Claim settlement ratio of Life Insurers in Year 2014-2015

Death Claim settlement ratio of Life Insurers in Year 2014-2015

IRDA Updates

Insurance Regulatory and Development Authority of India (IRDAI) have published its annual report of year 2014-2015 on 19/01/2016. Along with all the other data related to life insurers, general insurers and health insurer, IRDAI have also published the data related to individual death claim settle by all the 24 Life Insurance companies in year 2014-2015.

Individual death Claim Settlement Ratio of Life Insurers 

Death claim settlement ratio is the percentage of claim settled  by a life insurer out of the total claim raised in a particular year. In year 2014-2015, the industry average of death claim settlement ratio was 96.97% in numbers and 90.91% in amount. If we look at the private life insurers the average was 89.40% for numbers of claim settled, while 78.39% of claimed amount paid by private life insurers. Claim settlement ratio of state owned insurer, Life Insurance Corporation of India (LIC) was 98.19% of  number of claim paid and  95.51% of claimed amount paid in year 2014-2015.

Individual death claim settlement ratio (on number basis) by Life Insurers in Year 2014-2015

Top Insurers on basis of higher death claim settlement ratio

In year 2014-2015, the industry average of death claim settlement ratio was 96.97% in numbers and 90.91% in amount. On number basis only one insurer ie LIC of India is above the industry average with 98.19% death claim settlement ratio after that, in top five are Max Life (96.03%), Birla Sunlife (95.30%), Tata AIA (94.47%) and Star Union (94.47%).

On the basis of amount of claim settled, industry average was 90.91%, and among the all insurer top five are LIC of India (95.51%), Max life (93.59%) and Star Union (91.54%) which are above the industry average, while other two in top five are Sahara (89.86%) and Tata AIA (89.54%)

Individual death claim settlement ratio (on amount basis) by Life Insurers in Year 2014-2015

How does death claim ratio help policy holders?

Ultimate motive of buying a life insurance by a customer is to provide a financial security to his/her dependent after untimely demise of the life assured. Death claim ratio provide a view about a insurers ability to pay the claim and its ratio of rejection of claim. Though majority of claims which are repudiated are due to suppression of material facts by life assured at the time of taking policy, but higher rejection ratio reduces the credibility of insurer. A low rejection and outstanding in number but higher in amount show that an insurer is not able to pay claims of higher sum assured policy on time. This ratio help the policy holder to choose a good life insurer for taking a life insurance policy.

 To download the full annual report of IRDAI please Click Here

LIC may soon withdraw Jeevan Akshay VI

LIC may soon withdraw Jeevan Akshay VI

IRDA Updates, Life Insurance

After the gazette notification issued by Insurance Regulatory and Development Authority of India (IRDAI) on 14/10/2015 for annuity plans offered by Life Insurers, LIC of India may soon withdraw or relaunch (with modifications) its Immediate Annuity Plan Jeevan Akshay VI.

The Authority may issue separate instructions for withdrawing the products which are not in compliance with these Regulations but are currently offered by the Life Insurers and which are approved by the Authority prior to the date of notification of these Regulations.-F. No.IRDAI/Reg/14/104/2015

In the gazette notification IRDAI restrict an insurer to pay or undertake to pay an amount of benefit excluding any profit or bonus on any policy of insurance issued, less than:

  1. Annuity of 1,000 per month
  2. Gross sum of 5,000 (Except under Micro Insurance and Health Insurance Business)
  3. Gross sum of 1,000 for Micro Insurance and Health Insurance Business:

Jeevan Akshay VI is a immediate annuity plan of LIC of India, where annuity/pension is payable for life as per the option and  immediately after a month or whatever the mode chosen by Annuitant. Jeevan Akshay VI policy is available for the age group between 30 to 85 years, with minimum premium of 100000 for policy taken offline and 150000 for policy taken online (Excluding Service tax). Monthly Pension in Jeevan Akshay VI policy on minimum amount ie 100000 is mentioned below

Monthly annuity amount under options on min amount of Rs. 100000 in Jeevan Akshay VI

 Options mentioned above are

    1. Annuity payable for life at a uniform rate.
    2. Annuity payable for 5, 10, 15 or 20 years certain and thereafter as long as the annuitant is alive.
    3. Annuity for life with return of purchase price on death of the annuitant.
    4. Annuity payable for life increasing at a simple rate of 3% p.a.
    5. Annuity for life with a provision of 50% of the annuity payable to spouse during his/her lifetime on death of the annuitant.
    6. Annuity for life with a provision of 100% of the annuity payable to spouse during his/her lifetime on death of the annuitant.
    7. Annuity for life with a provision of 100% of the annuity payable to spouse during his/ her life time on death of annuitant. The purchase price will be returned on the death of last survivor.

To know more about the Jeevan Akshay VI plan and its benefits contact you LIC agent or visit your nearest branch. You can know more about Jeevan Akshay VI policy and buy it online Click Here

To read and download the gazette notification of IRDAI please Click Here

Keep all the Insurance policies in electronic form with Insurance Repository

Keep all the Insurance policies in electronic form with Insurance Repository

Insurance in News, IRDA Updates

Role & Objectives of Insurance Repositories:
“Insurance Repository” means a company formed and registered under the Companies Act, 1956 and which has been granted a certificate of registration by Insurance Regulatory and Development Authority (IRDA) for maintaining data of insurance policies in electronic form on behalf of Insurers.
To implement the Insurance Repository System, IRDA has granted Certificate of Registration to the following five entities to act as Insurance

Repositories.
• NSDL Database Management Limited
• Central Insurance Repository Limited
• SHCIL Projects Limited
• Karvy Insurance Repository Limited
• CAMS Repository Services Limited

A policy holder can buy and keep all the policies under an electronic Insurance Account (eIA) with any one of the Insurance Repository of his/her choice. The existing policies in physical mode too can be dematerialized and held in the eIA. The access to all the policies is then available at a click of a button. The Insurance Repository System not only provides policyholders a facility to keep insurance policies in electronic form but also enables them to undertake changes, modifications and revisions in the insurance policies with speed and accuracy. In addition, the Repository acts as a ‘single stop shop’ for policy servicing.