Page 27 - The Insurance Times October 2021

Table-9: Position of Individual Death Claims as on Y Many insurers keep the claims
pending beyond one year.
31.03.2019
Prominent among these insurers
Insurer % Claims % Claims Pending Duration wise are HDFC Life (26.47%) and LIC
Repudiated (No. of Policies) (11.25%). As a result, the industry
keeps 10.72% claims pending
or Rejected <3 3-6 6-12 >12
beyond one year. One reason can
(No. of months months months months
Policies) be that there are too many claims
in which thorough investigations
Birla Sun Life 2.4 87.5 12.5 0 0
are necessary. But, even then,
AEGON 7.96 0 0 0 0 claims have to be settled
Aviva 4.17 100 0 0 0 expeditiously and can not be left
Bajaj Allianz 4.69 100 0 0 0 unsettled for more than a year.
Bharti Axa 2.33 71.43 14.29 14.29 0 Y Both LIC and HDFC Life has a good
Canara HSBC 5.86 0 100 0 0 record of repudiating least
number of claims. For LIC, the
DHFL Pramerica 2.9 100 0 0 0
figure is 0.89 and for HDFC Life, it
Edelweiss Tokio 4.18 100 0 0 0 is 0.7.
Exide Life 2.97 0 0 0 0
Y It is extremely unfortunate that
Future Generali 10.63 62.5 37.5 0 0 quite a few insurers are
HDFC Life 0.7 52.94 20.59 0 26.47 repudiating/rejecting a large
ICICI Prudential 1.18 76.19 23.81 0 0 number of claims. These are
AEGON (7.96%), Canara HSBC
IDBI Federal 3.56 100 0 0 0
(5.86), Future Generali (10.63%),
India First 6.78 55.56 11.11 11.11 22.22 India First (6.78%), Sahara (7.49%)
Kotak Mahindra 2.21 33.33 0 58.33 8.33 and Shriram (13.32%). How can
MAX Life 1.24 100 0 0 0 people hold on to their policies if
they get news of insurers rejecting
PNB MetLife 3.76 0 0 0 0
claims for such a large number of
Reliance Nippon 2.25 75 0 0 25
cases?
Sahara 7.49 68.75 18.75 0 12.5
Y As most of the claims are non-early
SBI Life 4.47 46.43 50 3.57 0 in nature, investigations are not
Shriram 13.32 28.21 10.26 51.28 10.26 required. It is a common
Star Union 2.86 100 0 0 0 knowledge that the death claims
requiring investigation is never
Tata AIA 0.93 0 0 0 0
more than 20%. It is unfortunate
LIC of India 0.89 46.78 36.03 5.94 11.25
that only 49.66% claims are
Industry 1.17 49.66 32.15 7.47 10.72 settled within three months. The
Source: IRDA Annual Report, 2018-19 insurers can not consider
themselves as sensitive to the
Let's look at Table-9 very closely. This table gives us two important information needs of claimants if they can not
on the service quality of the insurers. One is the repudiation/rejection rate and settle claims promptly.
the other is the period for which claims remain pending. The main points can be
mentioned as under:
Y Although there is clear IRDAI guidelines that the death claims have to be IRDAI has taken certain
settled within 15 days of receiving all claim papers (3 months if a thorough steps in right direction
investigation is required), many of the insurers are not adhering to this
IRDAI is aware of the fact that life
guideline. For as many as 13 insurers claims are kept pending beyond 3 insurance industry has not yet been
months. Even top insurers like LIC, HDFC Life and SBI Life keep claims pending able to realise its full potential. The
beyond six months.

The Insurance Times, October 2021 27