How Important It Is To Know About Insurance Settlement Ratio?
For comfortable and worry-free living in this rapid age, insurance is a must. One can find ample companies offering various insurance schemes to the public in the market. However, for the right insurance plan, one needs to go for a little research and check essential points that can help him get the best plan. One needs to check the plans in terms of his requirements and premium for a specific term. However, among the leading points, while reviewing the right policy and plan, one must consider the insurance settlement ratio of the company, which can help him know what will happen to him if the claim comes.
What is the meaning of insurance settlement ratio?
The claim settlement ratio can be termed as the barometer with the help of which one can know if the service provider is fair enough to offer the claims when it comes or not. It is a simple mathematical calculation that one can go for. However, in this era, one can easily know the claim settlement ratio from the website of the concerned service provider also. If the company gets 100 claims for death and it settles 98 out of them, the ratio of settlement is considered as 98%. The better the claim settlement ratio, the higher is the reliability of the service provider.
Why is it important to check the insurance settlement ratio?
As far as the checking of the insurance settlement ratio is concerned, one needs to know that if the service provider offers the claim immediately or it keeps on lingering on the name of the process. The settlement ratio is fixed for a period, and hence it is calculated for the claims received in that particular period only. If a company gets 1000 claims a year and clears 960 while 30 are in process and 10 are declined, the true picture of the claim settlement from the same can be known as 96% only as rest is not clear. Hence it is an effective medium to know the policy of the service provider.
Here one needs to note that the settlement ratio is different for general and life insurance. In life insurance, it is fully paid while in general insurance, it is partly paid. If we take Car Insurance into consideration we can see that companies do not deny the claim, but as per the intensity of an event, the amount varies from case to case. Hence if one car has met with an accident and it has got 30000 as a claim, in the same case another car may get 50000 also. The claim settlement depends on many factors, and hence while going for such a claim, it is better to have advice from an agent or consultant first.
How to find the settlement ratio of an insurance company?
As per the norms of the regulatory authorities, it is mandatory for the companies to display their claim settlement ratio to the general public, and that is why the majority of the companies show the same on their website as well as branches. One can also find the same on the third-party websites which are involved in the insurance business as well as the site of the authority that regulates the insurance market. In many cases, the companies which have good settlement ratio, display the same in their commercials also which one can know and check.
Overall, one can say that to know the policy of insurance settlement by the company; there can be no better option than checking the claim settlement ratio of the company in the market. In the case of buying a policy, one needs to consider this ratio as an essential medium.