Health Insurance Claim Settlement Ratio Explained (+ Insurers Compared)
Quick answer: Claim Settlement Ratio (CSR) is the percentage of insurance claims an insurer settles out of total claims received in a financial year. Calculated as (Claims Settled ÷ Total Claims Received) × 100, a high CSR (above 95%) indicates a reliable insurer. IRDAI publishes annual CSR reports for all Indian health insurance companies.
Key facts
- CSR Formula: (Claims Settled / Total Claims Received) × 100.
- Benchmark: A CSR of 95% to 99% indicates a strong track record of honouring claims.
- CSR vs ICR: CSR measures claim numbers settled; Incurred Claim Ratio (ICR) measures the percentage of total premium paid out as claims.
- Regulatory Source: IRDAI Annual Handbook publishes official CSR data.
What is Claim Settlement Ratio (CSR)?
When buying group or retail health insurance, Claim Settlement Ratio (CSR) is the single most critical reliability metric. If an insurer receives 10,000 claims in a year and successfully pays 9,700 of them, its CSR is 97%.
However, CSR should never be evaluated in isolation. Smart HR teams and buyers look at CSR alongside Incurred Claim Ratio (ICR) and average turn-around time (TAT) for cashless approvals.
CSR vs Incurred Claim Ratio (ICR)
| Metric | Formula | What it measures | Ideal Range |
|---|---|---|---|
| Claim Settlement Ratio (CSR) | (Claims Settled ÷ Received) × 100 | Percentage of claim applications approved | 95% – 99% |
| Incurred Claim Ratio (ICR) | (Total Claim Amount Paid ÷ Total Premium Earned) × 100 | Financial health & claims payout ratio | 75% – 90% |
Frequently asked questions
Which health insurance company has the highest claim settlement ratio in India?
What is a good Incurred Claim Ratio (ICR)?
Related reading
Need group insurance for your team?
ClearCover is an IRDAI-registered insurance broker in Bangalore for group & employee-benefits insurance.