What's inside? 🧐
👉Introduction
👉What is Claim Settlement Ratio in Health Insurance?
👉How is Health Insurance Claim Settlement Ratio Calculated?
👉Health Insurance Claim Settlement Ratio - Is it Important?
👉What is the Incurred Claim Ratio?
👉Health Insurance Claim Settlement Data: CSR and Incurred Claim Ratio (2023-2024)
👉How to Check the Health Insurance Claim Settlement Ratio?
👉Types of Health Insurance Claims
👉Health Insurance Claim Settlement Process
Introduction
Health insurance is like a protective shield for you and your loved ones. When life throws unexpected health challenges your way, this health shield will be there to support you financially. And, when you set out to buy a health insurance policy, opting for an insurer with the highest claim settlement ratio is often recommended. However, it's crucial not to exclusively rely on this ratio when making your decision.
In this article, we will get into what the health insurance claim settlement ratio is, how it works and why you should not solely rely on it, helping you make the best choice for your and your family's health and happiness.
What is Claim Settlement Ratio in Health Insurance?
The claim settlement ratio of health insurance, often abbreviated as CSR, is a metric that determines the proportion of claims an insurance company successfully settles compared to the total number of claims they receive within a specific fiscal year.
How is Health Insurance Claim Settlement Ratio Calculated?
To calculate the Claim Settlement Ratio of health insurance companies, you will need three essential pieces of information –
👉Number of Claims Settled: This figure accounts for all the claims the insurance company successfully paid during a specific financial year.
👉Number of Claims Received: This number represents all the claims submitted to the insurance company in the same financial year.
👉Outstanding Claims at the Start of the Year: These are claims from previous years that remain unresolved and pending.
You can easily access this data through public disclosures on the insurance companies' official websites or in the annual reports published by the Insurance Regulatory and Development Authority of India (IRDAI), available on the IRDAI's website.
Once you have collected the necessary information, you can easily calculate the Health Insurance Claim Settlement Ratio (CSR) using the following formula –
Claim Settlement Ratio = (Number of claims settled) / (Number of claims received + Outstanding claims at the beginning of the year) x 100
For example, let’s imagine Insurer A has the following metrics -
👉Number of claims received: 1,000
👉Number of claims settled: 900
👉Outstanding claims at the beginning of the year: 100
Using the formula, we calculate Insurer A's CSR as follows –
CSR for Insurer A = (900) / (1,000 + 100) x 100 = 81.82%
The Claim Settlement Ratio of Insurer A is 81.82%
Health Insurance Claim Settlement Ratio - Is it Important?
Claim Settlement Ratio is often the first aspect that catches your eye on any insurance company's website nowadays. Some insurance agents may advise you to focus on the top claim settlement ratios among insurance companies in India to determine an insurer's reliability. At times, you might find the CSR figures of two of your preferred insurers to be similar, leaving you in a dilemma about which one to choose. But, keep in mind -
👉CSR Doesn’t Tell You about the Insurer’s Finances CSR does not shed light on an insurer's financial management and control, which are vital components. An insurance company's core responsibilities extend beyond claim settlements, encompassing long-term financial stability. This means having adequate reserves to honour valid claims and preventing fraudulent or invalid claims. Neglecting these aspects poses a significant risk to the insurer's ability to fulfil its obligations to you, even if the CSR is high.
👉CSR Doesn’t Tell You How Fast the Claim Will Be Processed The claim settlement ratio of health insurance, or CSR, doesn't tell you how quickly your claims will be processed. Let's consider a scenario: your family faces a medical emergency. What would you prefer? An insurer with a high CSR that could leave you waiting for weeks to receive essential coverage, or an insurer with a slightly lower CSR with faster claim processing, ensuring your family gets the necessary support promptly? It's not just about the numbers; it's about having swift access to critical healthcare services when you need them the most.
👉CSR Doesn't Reflect Customer Support Quality The smooth settlement of claims relies on effective communication between you and the insurer. Is the insurance company's customer support responsive and efficient when you need information or assistance? The company’s CSR in no way showcases the insurer’s customer service and how they will cater to your needs.
👉CSR Doesn't Guarantee Claim Settlement The CSR is a useful metric, but it doesn't tell the whole story about your claims experience. While a high health insurance claim settlement ratio (CSR) is indeed a good sign, it does not guarantee that your specific claims will be accepted. CSR only shows how well the insurance company has settled claims in the past. Having a high CSR does not mean your claims will always be approved, just as a lower CSR does not necessarily reduce your chances.
👉CSR Doesn't Tell You About The Claim Value Also, CSR does not specify the percentage of the claim amount resolved by the insurer. To achieve a high CSR, some insurers might settle many claims of low value but reject those of high value.
An insurer could approve claims for other types of coverage while rejecting claims for health insurance policies, effectively maintaining a high overall CSR. Hence, it is crucial to look beyond the CSR to get a complete picture of how your health insurance claims are likely to be handled.
Talk To Our Advisor To Learn More!
As mentioned before, just looking at the Claim Settlement Ratio is not enough to choose an insurance company for your health insurance needs. It does not tell you how many valid claims have been settled, how efficient the customer service of the insurer is, and the value of the claims that have been paid. It’s important to look at other aspects like the percentage of claims settled within 30 days to know how quickly you’ll get your payout, or the number of complaints the insurer has gotten, etc., to understand the claims journey you’ll face. To make this easy, you can easily reach out to a vetted MyInsureBuddy advisor - they can offer unbiased guidance, assisting you from selecting the right health insurance plan to navigating the claims process – all at no cost to you!
What is the Incurred Claim Ratio?
The Incurred Claim Ratio (ICR) is a key indicator that reveals the percentage of net claims settled by the insurance company in comparison to the net premiums they've accumulated during a specific fiscal year. By examining the ICR, it becomes straightforward to assess whether the insurer is disbursing a higher amount in claims than the revenue they are generating through premium collections.
Health Insurance Claim Settlement Data: CSR and Incurred Claim Ratio (2023-2024)
The table below displays the latest CSR and ICR figures for general and health insurance companies. These figures are extracted from the public disclosures of the respective insurance companies Q4, FY 2023-24.
Insurance Company | Claim Settlement Ratio of health insurance | Incurred Claim Ratio Acko General Insurance Co. Ltd | 93.29% | 56.91% Aditya Birla Health Insurance Co. Ltd | 94.51% | 68.31% Bajaj Allianz General Insurance Co. Ltd | 92.06% | 84.96% Care Insurance Health Insurance Co. Ltd | 90.50% | 57.69% Cholamandalam MS General Insurance Co. Ltd | 76.63% | 66.67% Future Generali India Insurance Co. Ltd | 90.90% | 84.62% Go Digit General Insurance Co. Ltd | 90.69% | 93.87% HDFC Ergo General Insurance Co. Ltd | 95.30% | 80.98% ICICI Lombard General Insurance Co. Ltd | 80.97% | 78.85% IFFCO Tokio General Insurance Co. Ltd | 83.74% | 107.46% Kotak General Insurance Co. Ltd | 89.04% | 59.06% Liberty General Insurance Co. Ltd | 86.57% | 79.92% Magma HDI General Insurance Co. Ltd | 77.63% | 87.46% ManipalCigna Health Insurance Co. Ltd | 87.68% | 63.78% National Insurance Co. Ltd | 79.53% | 90.83% Navi General Insurance Co. Ltd | 67.21% | 59.40% New India Assurance Co. Ltd. | 93.27% | 105.87% Niva Bupa Health Insurance Co. Ltd | 89.95% | 59.02% Oriental Insurance Co. Ltd | Data Not Available | 101.96% Raheja QBE General Insurance Co. Ltd | 82.13% | 106.27% Reliance General Insurance Co. Ltd | 93.14% | 89.42% Royal Sundaram General Insurance Co. Ltd | 84.90% | 92.06% SBI General Insurance Co. Ltd | 85.62% | 87.86% Shriram General Insurance Co. Ltd | 74.56% | 47.47% Star Health and Allied Insurance Co. Ltd | 85.32% | 66.47% Tata AIG General Insurance Co. Ltd | 94.51% | 77.94% United India Insurance Co. Ltd | Data Not Available | 109.23% Universal Sompo General Insurance Co. Ltd | 93.27% | 105.76% Zuno General Insurance Co. Ltd | 84.57% | 88.45%
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How to Check the Health Insurance Claim Settlement Ratio?
Here's how to check the health insurance claim settlement ratio –
👉Visit Insurance Company Websites: Most insurance companies share their claim settlement ratio of health insurance on their official websites.
👉IRDAI Annual Report: The Insurance Regulatory and Development Authority of India (IRDAI) publishes an annual report that provides information about the claim settlement ratio of health insurance of various insurance companies. You can access this report on the official IRDAI website.
👉Calculate It Yourself: If you want to calculate the CSR yourself, you will need the following information –
- The number of claims settled
- The total number of claims received
- The number of outstanding claims at the beginning of the year
You can easily find this data in the public disclosures made by insurance companies on their websites. Once you have the necessary information, you can easily calculate the health insurance claim settlement ratio of health insurance (CSR) using this simple formula –
Claim Settlement Ratio = (Number of claims settled) / (Number of claims received + Outstanding claims at the beginning of the year) X 100.
Types of Health Insurance Claims
Health insurance claims can be categorised into two primary types –
👉Cashless Claims
When you receive treatment at a hospital that is part of your insurance company's network, cashless claims come into play. A network hospital has an agreement with your insurance provider to facilitate cashless treatments. If the hospital you have chosen is on your insurer's list of approved cashless hospitals, they will handle and settle your medical expenses directly with the hospital. This means you don't have to pay for the treatment out of your own pocket. You just have to take care of the expenses that are non-payable by the insurer.
👉Reimbursement Claims
Reimbursement claims involve a different procedure. You initially pay for the hospitalisation expenses. Afterwards, you submit a reimbursement claim directly to your insurer, who will then refund you according to the terms and conditions outlined in your policy.
Health Insurance Claim Settlement Process (2024 Updated)
Prefer watching a video instead?
Explore this informative video to gain insights into the intricacies of the health insurance claim settlement process. It delves into the challenges encountered during the process and offers practical solutions to navigate them.
Let's delve into the details of the claim settlement process –
👉Cashless Claim Process
Here’s how the cashless claim process works -
Step 1: Eligibility Check
The initial and pivotal step involves verifying your eligibility for a cashless claim. This becomes especially important for medical conditions covered after serving a waiting period of 2-3 years.
Step 2: Cashless Service Availability
Next, you need to confirm whether your insurance company provides cashless services at the hospital where you intend to seek 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. However, if it is not on the exclusion list, ask them if they accept the cashless payment from your insurer.
Step 4: Understand Your Policy
Understand the limits and conditions outlined in your insurance policy. Check for any financial restrictions, such as room rent caps, ICU charges, limitations related to specific diseases and treatments, etc. This becomes especially important for planned medical procedures. Also, verify if your policy covers non-consumable items and whether there is a specific list of items it does not cover. This way, you can accurately estimate any potential out-of-pocket expenses.
Step 5: Ensure You Have the Required Documents Ready
To ensure a smooth and trouble-free cashless claim process, ensure you have these essential documents at your fingertips –
- Policy copy or cashless card
- All past medical records that led to the hospitalization including first consultation papers and follow-ups for any medication or medical condition that is related or unrelated to the current health issue.
- KYC of the proposer i.e PAN card, Aadhar card and passport-size photo
- ID proof of the patient
- Police FIR in case of an accident
Please be aware that the necessary documents for claim settlement may differ between insurance providers.
If you do not have the right paperwork your cashless claim may be denied. This might require you to settle the bills upfront and then seek reimbursement. Therefore, it is crucial to keep all the necessary paperwork readily available to avoid any complications during the claim process.
Step 6: Notify in a Timely Manner
For planned hospitalisation, it is essential to initiate a claim at least 3-4 days before your admission date. In cases of emergency hospitalisation, this request should be made within 24 hours of admission. The hospital will require specific details and documents from you to start a pre-authorisation request with your insurer for cashless claim approval.
Here’s a list of documents you’ll have to provide:
- Health card issued by the insurer
- KYC of the proposer i.e PAN card, Aadhar card and passport-size photo
- ID proof of the patient
- KYC of the insured person
- Policy number
- Policyholder’s name
- Name and address of the insured for whom the claim is filed
- Nature of the illness/injury and the treatment/surgery administered
- Attending medical practitioner’s name and address
- Admission date
- Past medical history that is related and unrelated to the current ailment. If the details are found to be different from the declaration made at the time of policy policy, your claim may be rejected.
Please be aware that the necessary documents for claim settlement may differ between insurance providers.
Ensure you have a copy of all original documents you submit for future reference.
Step 7: Be Prepared for Possible Advance Deposit
The pre-authorisation process can take anywhere from 6 to 24 hours, depending on your insurance company. There may also be inquiries that require your timely responses. In some cases, the hospital might request an advance deposit while your insurer processes the claim. This deposit will be reimbursed by your insurer later. To avoid any inconvenience, it is wise to set aside an emergency fund for such advance payments.
Additionally, any medical expenses incurred before your hospitalisation will need to be claimed separately from your insurer. Therefore, it is prudent to retain all original prescriptions, bills, receipts, and reports, including medical imaging films, that led to your hospitalisation. This ensures a smooth claims process for those expenses.
Step 8: Keep an Eye on Claim Processing
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. While your insurer may send updates about your claim's progress through your registered mobile number or email, there can be instances where the hospital fails to inform the insurer about your discharge or send the required documents. And, this may ultimately cause delays in the approval process.
So, it is crucial to stay informed about your claim's status. Regularly check for communication from your insurer. Typically, the approval process gets completed within 2-6 hours after your insurer is informed of your discharge. For a speedy claim settlement, it is essential to stay in touch with your insurer or advisor and keep track of the claim process.
Step 9: Scrutinise the Final Bill and Approval Letter
Upon receiving the final bill and approval letter, you should carefully examine them. This review helps you understand which expenses are approved and which are not. If you have any questions or uncertainties, do not hesitate to contact your insurer for clarification.
Pay close attention to the approval letter, as it may specify expenses that should not be billed to the patient. So, refrain from making payments for such designated expenses. Apart from these specified expenses, there may be other unapproved costs that you will need to cover out of your own pocket before leaving the hospital.
👉Reimbursement Claim Process
Here's what you need to do to file a reimbursement claim –
Step 1: Verify Hospital Inclusion
Before seeking treatment at a hospital that is not part of your insurance network, ensure it is not on the list of excluded providers. If it is present on that list, your claim will not be accepted, and you will need to choose a different hospital. You can confirm this by contacting your insurance company via their toll-free number, email, or SMS.
Step 2: Notify Your Insurance Company
Within 24 hours of your admission, inform your insurer about your hospitalisation. You can find their contact information on your policy document or the insurer's website.
Step 3: Gather Essential Hospital Documents
Once your treatment is complete, it is crucial to gather all original documents from the hospital before your discharge. These documents include: -
- Original receipts and invoices.
- Discharge summary.
- The claim form (part of it filled out by the hospital).
- Medical reports, which may include MRI, X-ray films, etc.
- Doctor prescriptions for all the payments you have made.
Ensure you double-check the patient's name, gender, and age on all these documents, correct any errors, and keep everything well organised in a file. If possible, request a detailed bill that breaks down all the costs from the hospital. Also, inquire about obtaining a copy of the case sheet/indoor case papers and the hospital's registration certificate if the non-network hospital is willing to share them. You must gather and arrange your documents carefully to ensure a smoother reimbursement process.
Step 4: Gather All Necessary Documents
Before proceeding with a reimbursement claim, it is crucial to contact your insurer to obtain the list of required documents. Here's a list of common documents –
- Health card or a copy of your policy.
- KYC documents of the proposer, including the PAN card, Aadhar card, a passport-size photo and a bank statement that displays the bank name, account number, and IFSC code, or a copy of the bank passbook with the latest transaction page, or an original cancelled check with your name on it.
- Patient's proof of identity.
- A completely filled and signed claim form.
- All relevant documents, such as test reports, films, receipts, medical prescriptions related to the treatment, etc.
- The original discharge summary from the hospital.
- In cases involving implantation procedures (e.g., knee replacement, cataract claims, etc.), include the IOL sticker and invoice from the hospital.
Please note that the specific list of required documents for claim settlement may vary among insurers.
Step 5: Complete the Claim Form
Once you have collected all the necessary documents, you can initiate your reimbursement claim. Make sure you accurately fill out the claim form and submit it along with the required documents to your insurer.
Step 6: Submit Your Documents
Besides your hospitalisation bills, you can also include any pre- or post-hospitalization bills along with the prescribed medications and reports. This ensures that you won't overlook any eligible expenses.
Step 7: Obtain an Acknowledgment
It is important to retain copies of all the original documents you submit to the insurer. Additionally, make sure to obtain an acknowledgement from the insurance company or third-party administrator (TPA) to confirm the submission of these original documents.
Step 8: Keep Track of Your Claim's Progress
After you have submitted your claim, it is crucial to stay informed about its progress with your insurer. They will review the claim and may occasionally request additional information or documents, which should be promptly provided to expedite the settlement process.
Step 9: Review the Claim Settlement Summary
Once the process is finalised, the approved amount will be deposited into your authorised bank account. You will receive a settlement summary outlining all the deductions made. It is essential to examine these deductions carefully. If you have any questions or need clarification, feel free to reach out to your insurer for clear answers about the settlement process.
Now that we have an understanding about CSR, let's delve into another essential metric known as the Incurred Claim Ratio (ICR).
To conclude!
The health insurance claim settlement ratio represents only a fraction of the complete picture in assessing whether an insurer will safeguard your financial well-being. You can explore MyInsureBuddy's Health Decoder - a product that provides in-depth information about a wide range of health insurance plans. You can gain a comprehensive understanding of the plan by delving into its specifics, including its features, limitations, financial limits, as well as evaluating the insurer's track record in terms of claims processing, customer service, and more.