As we all know, there are 20 odd personal life insurance coverage firms in India, and there may be LIC which is a public sector firm. LIC is the 800 pound gorilla, managing to carry on to about 75% market share even 10 years after personal firms have been allowed into the life insurance coverage area. The personal life firms place themselves on being extra buyer pleasant, wider array of merchandise and so forth whereas LIC holds on to its positioning of belief, expertise and authorities backing. One of many key parameters on which to guage a life insurance coverage firm is their claims fee report. On the identical time, we should be aware that provided that life has turn out to be extra of a financial savings and funding product, the returns that they supply are maybe extra essential than claims payout ratios. Nonetheless, claims report is certainly not a variable to be ignored. A desk illustrating the claims rejection percentages of the highest life insurance coverage firms in 2009-10 is offered under:
Life Firms: Claims rejection ratio (%)
Bajaj Allianz: 5.2%
Birla SunLife: 10.62%
HDFC Life: 4.67%
ICICI Prudential: 3.27%
ING Vysya: 4.26%
Max New York Life:12.31%
Tata AIG: 12.3%
An essential statement from the above desk is that the claims rejection ratio of LIC is the bottom, thus implying that their report is one of the best so far as claims fee is worried. On the identical time, the very excessive share of claims rejection of SBI Life and Max New York Life absolutely is available in as a shock.
It should nonetheless be famous as soon as once more that in Unit Linked merchandise that life organisations promote aggressively (or not less than was selling until Sep 2010), the returns earned on the fund is maybe a extra essential variable than the claims fee (or rejection) ratio. Nevertheless, for non life firms, which provide pure safety/insurance coverage merchandise with no financial savings or funding element, claims fee is the essential variable together with the velocity of processing of claims.
Allow us to now have a look at the incurred claims ratios of the non-life firms:
Non-Life Insurance coverage Firm: Incurred claims ratio
New India Assurance: 89%
Oriental Insurance coverage: 99.69%
United India Insurance coverage: 78.62%
Nationwide Insurance coverage: 99.16%
Royal Sundaram: 68.95%
Reliance Basic Insurance coverage:77.3%
Iffco Tokio Insurance coverage:83.44%
Tata AIG: 60.54%
ICICI Lombard: 85.35%
HDFC Ergo: 80.73%
One knowledge level that stands out from above is that Tata AIG Basic Insurance coverage appears to be sourcing the very best quality enterprise from the underwriting viewpoint, whereas the claims fee ratio of Bharti Axa appears to be fairly excessive. Alo,the claims fee ratio of the general public insurers, at an general stage, is greater than that of the personal non life insurers.