How to assess a life insurer's claim-settlement ratio

A term insurance policy protects dependents in case of death. So, claim-settlement ratio (CSR) – death claims settled out of total claims received - is key when selecting a life insurer. Companies whose CSR is higher, say, over 97 percent, may seem like safe bets. But, go deeper to study CSR by policy count and by benefit amount, especially if you are buying policies with sums assured of over Rs 25 lakh. Some insurers tend to settle smaller claims while dragging their feet over larger ones, resulting in high CSR by policy count and relatively lower CSR by benefit amount. A wide gap is a red flag. ​