Claim Settlement Ratio in Life Insurance

What is Claim Settlement Ratio?

Claim Settlement Ratio (CSR) measures the proportion of life insurance claims an insurer approves and pays out compared to the total number of claims it receives in a financial year. 

 

A higher CSR shows the reliability and trustworthiness of the insurer for paying claims. The Insurance Regulatory and Development Authority of India (IRDAI) publishes the CSR of all life insurers in its annual report. For customers, this makes CSR one of the most transparent and reliable indicators when evaluating an insurer’s credibility. 

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Why Claim Settlement Ratio Matters in Life Insurance

Secure Your Family’s Future

Family Confidence in a Crisis

When a family loses a loved one, the last thing they would want to worry about is whether the insurance payout will come through. A high CSR gives them confidence that the insurer has a track record of honouring commitments swiftly.

Secure your financial future

Trust in the System

 CSR may act as a neutral yardstick that allows families to decide which insurance company to choose. 

Claim Process

 Indicator of Processes and Ethics

 A consistently strong CSR indicates robust internal processes and fair underwriting. It shows that the insurer culture prioritises customer welfare over technicalities.  

How Is Claim Settlement Ratio Calculated?

The Claim Settlement Ratio (CSR) shows the percentage of claims an insurer settles out of the total received in a financial year.

Formula for CSR:

CSR = (Total claims settled in a year ÷ Total claims received in a year) × 100

This means the ratio is always expressed as a percentage, showing the proportion of successful claim settlements. 

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Claim Settlement Ration-Mobile

Types of Life Insurance Claims

When you purchase life insurance, different types of claims may arise:

Maturity claims

Paid when the policy term ends, provided the insured survives the term. 

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Death claims

The most common type of claim, paid to nominees when the policyholder passes away during the policy term.

Accidental Death Benefit

Rider claims

For additional benefits like accidental death, critical illness, or disability riders.

Additional Riders

Maturity claims

Paid when the policy term ends, provided the insured survives the term. 

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Death claims

The most common type of claim, paid to nominees when the policyholder passes away during the policy term.

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Rider claims

For additional benefits like accidental death, critical illness, or disability riders.

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How Claim Settlement Ratio Affects Your Life Insurance Policy

The claim settlement ratio of life insurance companies directly impacts you and your family’s future: 

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Every Genuine Claim will be Settled

Every Genuine Claim will be Settled

A company with a strong CSR is likely to settle every genuine claim that comes their way.  

Secure your family’s future

Financial security

Financial security

Families can rely on timely payouts without additional stress during emotionally difficult periods.

Loan protection

Long-term assurance

Long-term assurance

It assures you that the insurer values customer commitments. 

Factors That Influence Claim Settlement Ratios

While CSR is vital, it’s also shaped by multiple factors. Understanding these helps you interpret an insurer’s performance more meaningfully:
  • Failure to disclose at proposal stage: If applicants hide medical history or provide false details, claims may be rejected. Insurers with strong CSR often have better pre-policy checks and robust underwriting that lead to smoother approvals. 
     
  • Fraud detection mechanisms: Some claims are fraudulent. While settling claims if insurers suspect a fraud, the claim will be rejected. This lowers the claim settlement ratio. 
     
  • Claims service infrastructure: Dedicated claims teams, digital platforms, and streamlined documentation play a big role in timely settlements. 
     
  • Regulatory compliance: Adherence to IRDAI timelines and procedures ensures claims are handled fairly and transparently. 


 

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How to Choose an Insurer with a Good Claim Settlement Ratio
A high CSR is important, but not the only factor - here’s how to assess better.

01
Look for consistency

Check whether the insurer has maintained a high CSR over at least three to five years. 

02
Consider the speed of settlement

A claim should ideally be settled within 15 days (without investigation) or 45 days (with investigation). Check the insurance company’s track record for settling claims.    

03
Balance CSR with other factors

Premium affordability, customer service, and rider options also matter. CSR is crucial, but not the only factor. 

04
Other Factors

Don’t just look at CSR - consider customer service, claim process, and digital ease while selecting an insurer. 

Bandhan Life’s Claim Settlement Performance 

 

In the Indian market, Bandhan Life has consistently demonstrated a strong commitment to customer trust through its claim settlement record.  Bandhan Life has maintained one of the highest CSR, reinforcing its dedication to honouring promises made to policyholders.

 

For customers, this means not just statistics but a genuine assurance: with Bandhan Life, you’re choosing an insurer that values reliability and dignity in every settlement. 

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Bandhan Life CSR Graph 99.73%
Submitting a Life Insurance Claim​ with Bandhan Life
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Documents Required for Claim Settlement

01
Original policy document

When the policy was purchased

02
Claim form

Filled and signed by the claimant.​

03
Death certificate

Issued by the municipal government.​

04
Medical records (if applicable)

Hospital discharge summary, medical reports.​

05
Identity and address proofs of the nominee

Aadhar card, PAN card, passport, etc.​

06
Bank account details

Claimant’s bank passbook or cancelled cheque.​

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Claims Process of Bandhan Life

01
Claim intimation

Inform Bandhan Life about the claim online or through our helpline.

02
Document submission

Submit required claim forms and supporting documents. 

03
Verification

Our claims team reviews the documents and verifies details. 

04
Claim decision

Once verified, the claim is approved and paid directly into the nominee’s bank account.

This customer-first approach ensures that families receive their due without unnecessary stress.

FAQs on Claim Settlement Ratio

What is the meaning of Claim Settlement Ratio?

It is the percentage of claims an insurer has successfully paid compared to the total claims received in a financial year. 

What is a good Claim Settlement Ratio for a term plan?

Generally, a CSR above 90% is considered good and indicates that every genuine claim will be honoured. 

How does the Claim Settlement Ratio affect insurance claims?

A higher CSR increases the likelihood of your family’s claim being settled quickly and without hassle. 

What is the time frame within which the claim has to be reported?

There is no particular timeframe for reporting a claim, however, it is recommended to report a claim as soon as possible, ideally within 90 days of the event, although insurers may allow reasonable delays in certain circumstances. 

The views and opinions expressed in this article are solely those of the independent writer and are intended for general informational purposes only. They should not be construed as investment, financial, or insurance advice. Bandhan Life Insurance Company Limited does not, in any manner, endorse or influence the views expressed herein and shall not be responsible for any direct or indirect loss, liability, or consequence arising from the use of the information contained in this article.

Readers are advised to seek independent professional advice before making any investment or insurance-related decisions. For detailed information on risk factors, terms, and conditions, please refer to the sales brochure and policy document available at www.bandhanlife.com before concluding a sale.

[^] Individual Death Claim Settlement Ratio for Bandhan Life Insurance Limited for FY 2024-25 is 99.73% for FY 2023-24 is 99.67% and for FY 2022-23 is 99.37% as per annual audited figures of respective FYs. 

ADVT No. II/Nov 2025/0440