Has LIC’s death claim settlement capacity reduced over the years?

In the recently released IRDA annual report for FY 2019-2020, LIC’s claim settlement ratio (CSR, death claims) was 96.69%. Since FY 2016-2017, LIC’s CSR has been decreasing. Is this a cause for concern? We investigate. Before we proceed, the reader needs to appreciate that the Claim settlement ratio is not a probability of life insurance…

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Claim settlement ratio is not a probability of life insurance claim acceptance!

The claim settlement ratio is the number of death claims settled divided by the total number of death claims received. Many people assume/claim that this ratio represents the probability of life insurance claim settlement. Here is why this is incorrect. Take the case of dice used in gambling. A single die is a cube with…

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Why claim settlement ratio will not help you choose a term life insurance policy

Claim settlement ratios (CSR) published by IRDA do not represent the probability of claim acceptance. Most private insurers have a claim settlement ratio comparable to that of LIC. Therefore the CSR will not help you choose a term life insurance policy. At best, CSRs would help you reject a few insurers. Here are some insights…

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Will Life Insurance Claim Be Denied Without a Valid Driver’s License?

Will a life insurance claim be denied if the insured died in an accident where he was the driver without a valid driver’s license or valid vehicle insurance? Thanks to a question by Ganapathy Krishnan at Facebook group, Asan Ideas for Wealth, I was able to obtain an authoritative answer to this question from the insurance…

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