Health & claims
What is the difference between claim settlement ratio and incurred claim ratio?
The claim settlement ratio is the share of claims an insurer settles out of the claims it receives. The incurred claim ratio compares the money an insurer pays out in claims with the premium it earns. One tells you how often claims are paid; the other tells you how much of the premium comes back as claims.
In short
- Claim settlement ratio: claims settled ÷ claims received.
- Incurred claim ratio: claims paid out ÷ premium earned.
- In India, group health returns more of its premium as claims than individual cover.
- Neither ratio tells you how fully a claim was paid.
What is the claim settlement ratio?
The number of claims an insurer settled, as a share of the claims it received in a year. A higher figure means fewer claims were rejected or left pending. It counts claims, not money: a claim paid at a fraction of its value still counts as settled.
What is the incurred claim ratio?
The claims an insurer incurred in a year, as a share of the premium it earned. A figure near 100% means most of the premium came back as claims; a much lower figure means the insurer kept more of it. Very high figures can signal pricing that won’t last.
What do the numbers say about group vs individual cover?
Group health gives more of its premium back. IRDAI’s latest annual report shows group health incurred ₹92 in claims for every ₹100 of premium, against ₹78 on individual policies. It is one reason company cover is such good value while you have it.
How should I use these ratios?
As one signal among several. Look at both ratios over a few years, not one, and pair them with what matters at claim time: how much of each claim was paid, how quickly, and how disputes were handled. We don’t rank insurers, and no single ratio should do it for you.
Frequently asked questions
What is claim settlement ratio in health insurance?
The share of claims an insurer settles out of the claims it receives in a year.
What is incurred claim ratio?
The claims an insurer incurs as a share of the premium it earns in a year.
Which ratio is better to look at?
Both, over several years, alongside how fully and quickly claims are paid. Neither ratio alone tells the whole story.
What happens when you talk to us
A 20-minute video call with a Growth Advisor. No obligation, and no quote pushed. It opens with a five-minute video from our founder on how the benefits stack works and why Ethika exists; the rest is your questions. You’ll leave with an honest read on your current cover and claims experience, and a straight answer on whether we can genuinely help, even if you never become a client.
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A note on this page. Everything here is general information, not financial advice, and nothing is an offer. No insurer is named or ranked. The group and individual figures are from IRDAI’s latest annual report as cited on our personal health insurance guide; re-verify before relying on them. For advice about your situation, talk to us.