Religare Health Insurance Claim Settlement Ratio

Religare Health Insurance Company is a standalone health insurance provider offering specialised health and overseas travel insurance plans. The company offers both indemnity health insurance plans as well as fixed benefit plans. The company is promoted by Religare Enterprises Limited which is a financial services group of India. Other joint owners of the company are two leading banks of India, Union Bank of India and Corporation Bank. Thus, the company is backed by strong founders and offers unique health insurance solutions.

Claim settlement ratios of health insurance companies is a measure of the company’s claim payment history. The ratio is measured and expressed as a percentage. The following formula is used to calculate the claim settlement ratio –

Claim settlement ratio = (number of claims paid during a financial year / total number of claims made on the company in the financial year) * 100

If the claim settlement ratio is in the 90% range, it is said to be a positive indicator. It states that the company paid 90% of the claims which were made during the year. Higher claim settlement ratios are better for the insurance companies and Religare Health Insurance also has high claim settlement ratios. Moreover, the company’s Incurred Claims Ratio is also good. Incurred Claims Ratio is an important measure for general insurance companies and the ratio is different from claim settlement ratio. Incurred claims ratio is calculated using the following formula –

Incurred Claims Ratio = (total amount of claims paid in a financial year / total amount of premiums collected in the financial year)* 100

The ratio thus helps to determine whether the company paid more in claims than it earned in premiums. In such cases, the ratio is more than 100% and the company suffers a loss. Continued losses are bad for the insurance company as they affect the company’s financial stability and solvency margins.