Life insurance is an essential component of financial planning, providing financial security to the family and/or dependents. It is a promise made by the company to ensure the financial well-being of the family in case of untimely demise of the policyholder. It is a tool to alleviate the financial distress caused by the loss of a loved one.
Claims are the moment of truth for the industry and therefore one must purchase a policy from a brand they trust. Evaluating the claims settlement ratio and the average time taken to settle a claim can be a good indicator of a customer-friendly life insurer. The turnaround time too is critical as it ensures that the beneficiaries receive the claim proceeds quickly.
However, the onus does not squarely lie with the insurance company. Customers also shoulder the responsibility of truthfully disclosing all material information at the time of purchase, this ensures a quick and hassle-free claims experience for the nominees.
The chart below depicts the claims settlement ratio of a few life insurance companies.
Notably, ICICI Prudential Life Insurance has a consistent claim settlement ratio track record, featuring a noteworthy 98.6% claims settlement ratio for the initial nine months of FY2024.
The claim settlement ratio of ICICI Prudential Life in Q1-FY2024 was 98.10%, Q2-FY2024 was 98.14% and Q3-FY2024 the ratio stood at 98.52%. Notably, the average claim settlement turnaround time for non-investigated claims was only 1.3 days for nine months ended December 2023 after submission of all relevant documents.
ICICI Prudential Life also has a ‘Claim For Sure’ service initiative which ensures all eligible death claims are settled in one day after receiving all documents. Should any delay occur in processing a claim under this initiative, ICICI Prudential Life compensates the beneficiary with interest accrued on the claim amount. Furthermore the Company offers home pick-up of claim related documents, apart from enabling its digital touchpoints such as WhatsApp, Mobile App and Website to lodge and track claims to significantly improve customer experience,.
For the first nine months of this fiscal year ICICI Prudential Life settled 3,070 claims under ‘Claim For Sure’ amounting to Rs 214.70 crore. Also, a significant majority of claims are electronically settled ensuring the beneficiaries have virtually immediate access to the claim proceeds.