general insurance claim insights for policyholders...

GENERAL INSURANCE CLAIM INSIGHTS FOR

POLICYHOLDERS

A HANDBOOK

INSURANCE BROKERS ASSOCIATION OF INDIA

ABOUT THE HANDBOOK 1

ABOUT INSURANCE BROKERS 1

ABOUT INSURANCE BROKERS ASSOCIATION OF INDIA 1

METHODOLOGY & DATA 2

OVERALL INSURERS’ COMPARISON: SOLVENCY RATIO 4

OVERALL INSURERS’ COMPARISON: CLAIMS SETTLEMENT EFFICIENCY RATIO 6

OVERALL INSURERS’ COMPARISON: PENDENCY RATIO 7

FIRE: CLAIMS SETTLEMENT EFFICIENCY RATIO 8

FIRE: CLAIMS PENDENCY RATIO 9

MARINE: CLAIMS SETTLEMENT EFFICIENCY RATIO 10

MARINE: CLAIMS PENDENCY RATIO 11

MOTOR: CLAIMS SETTLEMENT EFFICIENCY RATIO 12

MOTOR: CLAIMS PENDENCY RATIO 13

HEALTH: CLAIMS SETTLEMENT EFFICIENCY RATIO 14

HEALTH: CLAIMS PENDENCY RATIO 16

MISCELLANEOUS: CLAIMS SETTLEMENT EFFICIENCY RATIO 18

MISCELLANEOUS: CLAIMS PENDENCY RATIO 19

GLOSSARY 20

DISCLAIMER 20

CONTENTS

ABOUT THE HANDBOOK

This handbook is created by Insurance Brokers Association of India (IBAI) in the interest of policyholders to provide additional data to help them make an informed decision while analyzing a general insurer.

ABOUT INSURANCE BROKERS

Insurance Brokers are representatives of the policyholders’ interests and are regulated by the IRDAI (Insurance Brokers) Regulations, 2013. Insurances brokers work for policyholders’ interests and are therefore, the fastest growing among distribution channels contributing to about INR 19,300 crores of gross direct premium in FY15 resulting in 23.2% of the non-life insurance premium. Insurance Broking registered the highest CAGR of 27.7% between FY10 and FY15 among the major channels in non-life insurance. As per the EY Vison 2025, brokers driving customer-centric growth report, it is expected that insurance broking will contribute close to 40% of of gross direct premium in non-life insurance in the progressive scenario. As per the report, non-life insurance market in 2025 is expected to be at Rs 4,00,000 Crs and brokers market share is likely to be around Rs 1,60,000 Crs.

ABOUT INSURANCE BROKERS ASSOCIATION OF INDIA

Insurance Brokers Association of India (IBAI) is the only Insurance Regulatory and Development Authority of India (IRDAI) recognized apex body of licensed Insurance Brokers. As per Insurance Brokers’ Regulations 2002 framed by the IRDAI, all licensed Brokers are required to be members of IBAI. As on December 31, 2016, there are 376 insurance brokers in India including Direct Insurance Brokers, Composite Insurance Brokers and Re-insurance Brokers.

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METHODOLOGY & DATA

This study considers the following criteria to present analysis of claims data points of insurers through public data points till date.

1. Solvency Ratio - The ability of an insurance company to pay the claim i.e. its financial strength.

“Higher the Solvency Ratio, better is the ability of an insurer to pay the claim”

2. Claims Settlement Efficiency Ratio % - The efficiency of an insurance company to pay the claims i.e. The number of claims that are paid within 3 months as compared to the number of total claims paid.

“Higher the claims settlement efficiency ratio, better is an insurance company in terms of the measured ratio”

3. Claims Pendency Ratio % - The number of claims that are pending for more than 1 year out of the total number of pending claims.

“Lower the claims pendency Ratio, better is an insurance company in terms of the measured ratio”

Insurers are evaluated and ranked basis the above 3 criteria both at company level and at line of business level i.e. Fire, Marine, Motor, Health and Miscellaneous.

1. Insurer Categories: Insurers are categorized into four different categories according to the Gross Premium

Written by them in that line of business for the year ending 31st March 2016 from the IRDAI Journal Volume XIV No. 3. For overall company ratios, the total premium written is considered.

a. Public Sector General Insurers

b. Private Sector General Insurers – Category A: The top 10 private sector general insurers on the basis of the gross premium written by the respective insurers in that line of business for line of businesswise ratios.

c. Private Sector Insurers – Category B: The remaining private sector insurers.

d. Standalone Health Insurers: The claims settlement efficiency ratio and claims pendency ratio has been considered for the Health line of business for the following -

i. Apollo Munich Health Insurance ii. Max Bupa Health Insurance iii. Religare Health Insurance iv. Star Health and Allied Insurance v. Cigna TTK Health Insurance

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2. Source of Data: a. Claims related data is taken from respective public disclosures of Insurance

companies from their respective websites for the quarter ending June 30, 2016. These disclosures include the following - i. NL 24 (Ageing of Claims): It includes data on how claims have been paid over

various time periods. Here, the data for Claims Paid in 0-1 month has been clubbed with the data for 1-3 months to arrive at 0 – 3 months data.

ii. NL 25 (Claims Data): It includes data on ageing of outstanding claims over various time periods.

b. For the above mentioned disclosures, the following lines of business have been clubbed together –

i. Marine: Marine Cargo & Marine Hull ii. Motor: Motor (Own Damage) & Motor (Third Party) iii. Miscellaneous: Engineering, Aviation, Liability, Credit Insurance, Personal

Accident, Travel, Crop & Other Miscellaneous Insurance.

c. Solvency Ratio data is sourced from NL-33 published on insurer’s website as on September 30, 2016.

d. The data considered only refers to the number of claims and not claim amounts. Corresponding data on claim amounts is not available in the public domain for the Indian insurance market.

3. Exclusions: i. L&T General Insurance – The Company now has been acquired and no more

accepting new proposals. ii. Kotak General Insurance and Aditya Birla Health Insurance: The Insurers were not

incorporated in the period for which claims data is taken i.e. 2014-15 iii. Standalone / Specialized Insurers – Following specialised insurers are not

considered for evaluation:- 1. Agriculture Insurance Corporation of India 2. Export Credit Guarantee Corporation of India

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Solvency Ratio as on September 30, 2016 - The ability of an insurance company to pay the claim i.e. its financial strength

Higher the Solvency Ratio,better is the ability of an insurer to pay the claim

OVERALL INSURERS’ COMPARISON: SOLVENCY RATIO

RANK INSURER SOLVENCY RATIO %

1 New India 2.042 United India 1.563 National 1.264 Oriental 1.14


1 Bajaj Allianz 2.532 Shriram General 2.073 ICICI Lombard 2.034 SBI General 2.005 Reliance General 1.816 Royal Sundaram 1.667 IFFCO Tokio 1.648 Tata AIG 1.649 Cholamandalam MS 1.64

10 HDFC Ergo 1.52


1 Raheja QBE 4.442 Liberty Videocon 4.093 Magma HDI 1.994 Bharti AXA 1.805 Universal Sompo 1.566 Future Generali 1.51

PUBLIC SECTOR GENERAL INSURERS

PRIVATE SECTOR GENERAL INSURERS – CATEGORY A

PRIVATE SECTOR GENERAL INSURERS – CATEGORY B

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Note: The IRDAI prescribed minimum solvency ratio is 1.5 times the net written premium and net written claims at all times, according to the IRDA (Assets, Liabilities, and Solvency Margin of General Insurers) Regulations, 2000 vide circular no. 045/IRDA/F&A/Mar-06 dated March 31, 2006, applicable retrospectively from April 01, 2005.


1 Max Bupa 2.442 Religare Health 2.213 Cigna TTK 1.684 Apollo Munich 1.625 Star Heatlh 1.59

STANDALONE HEALTH INSURERS

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Claims Settlement Efficiency Ratio % for the quarter ending June 30, 2016 – The efficiency of an insurance company to pay the claims i.e. The number of claims that are paid within 3 months as compared to the total number of claims paid.

Higher the claims settlement efficiency ratio,better is an insurance company in terms of the measured ratio

OVERALL INSURERS’ COMPARISON:CLAIMS SETTLEMENT EFFICIENCY RATIO

*Please note that the above ranks have been derived on the basis of ratios calculated upto two decimal places. For the sake of simplicity, the data has been rounded off to exclude decimals. This data is based on the number of claims and not claim amounts. Data on corresponding claim amounts is not available in the Indian insurance market.

RANK INSURER CLAIMS SETTLEMENT EFFICIENCY RATIO %

1 United India 95%2 New India 93%3 Oriental 91%4 National 60%


1 ICICI Lombard 97%2 Bajaj Allianz 96%3 Reliance General 96%4 Royal Sundaram 96%5 HDFC Ergo 95%6 Tata AIG 94%7 Cholamandalam MS 93%8 SBI General 87%9 IFFCO Tokio 81%

10 Shriram General 74%


1 Liberty Videocon 97%2 Universal Sompo 95%3 Bharti AXA 92%4 Future Generali 91%5 Magma HDI 87%6 Raheja QBE 17%




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Claims Pendency Ratio % for the quarter ending June 30, 2016 - The number of claims that are pending for more than 1 year out of the total number of pending claims.

Lower the claims pendency ratio,better is an insurance company in terms of the measured ratio

OVERALL INSURERS’ COMPARISON: PENDENCY RATIO

RANK INSURER CLAIMS PENDENCY RATIO%

1 United India 23%2 Oriental 34%3 New India 42%4 National Insurance 43%


1 SBI General 18%2 ICICI Lombard 20%3 IFFCO Tokio 24%4 Tata AIG 27%5 Cholamandalam MS 31%6 HDFC Ergo 36%7 Reliance General 38%8 Royal Sundaram 39%9 Bajaj Allianz 43%



1 Magma HDI 4%2 Liberty Videocon 6%3 Future Generali 24%4 Universal Sompo 27%5 Raheja QBE 27%6 Bharti AXA 36%




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FIRE: CLAIMS SETTLEMENT EFFICIENCY RATIO


1 United India 54%2 Oriental 46%3 New India 45%4 National 25%


1 Cholamandalam MS 100%2 ICICI Lombard 98%3 HDFC Ergo 62%4 Reliance General 59%5 Future Generali 46%6 Bajaj Allianz 43%7 Universal Sompo 41%8 Tata AIG 29%9 IFFCO Tokio 28%

10 SBI General 25%


1 Royal Sundaram 92%2 Shriram General 88%3 Magma HDI 64%4 Bharti AXA 19%5 Liberty Videocon 0%




Raheja QBE reported Nil Paid claims in Fire during the period

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FIRE: CLAIMS PENDENCY RATIO


1 United India 20%2 Oriental 24%3 National 32%4 New India 35%


1 Universal Sompo 6%2 HDFC Ergo 8%3 Cholamandalam MS 16%4 Future Generali 18%5 SBI General 19%6 Reliance General 29%7 Tata AIG 33%8 ICICI Lombard 53%9 Bajaj Allianz 56%

10 IFFCO Tokio 62%


1 Magma HDI 7%2 Shriram General 11%3 Royal Sundaram 16%4 Liberty Videocon 20%5 Raheja QBE 33%6 Bharti AXA 47%




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MARINE: CLAIMS SETTLEMENT EFFICIENCY RATIO


1 New India 77%2 Oriental 73%3 United India 68%4 National 45%


1 Cholamandalam MS 100%2 ICICI Lombard 99%3 HDFC Ergo 97%4 Royal Sundaram 91%5 Tata AIG 90%6 Bajaj Allianz 85%7 IFFCO Tokio 85%8 Reliance General 85%9 Future Generali 70%

10 Bharti AXA 40%


1 Universal Sompo 94%2 Magma HDI 83%3 SBI General 75%4 Liberty Videocon 70%5 Shriram General 33%




Raheja QBE reported Nil Paid claims in Marine during the period

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MARINE: CLAIMS PENDENCY RATIO


1 Oriental 18%2 New India 23%3 United India 26%4 National 29%


1 HDFC Ergo 2%2 Cholamandalam MS 8%3 Future Generali 11%4 Tata AIG 12%5 ICICI Lombard 13%6 IFFCO Tokio 14%7 Reliance General 15%8 Bharti AXA 18%9 Royal Sundaram 20%

10 Bajaj Allianz 28%


1 Universal Sompo 0%2 Shriram General 0%3 Magma HDI 1%4 Liberty Videocon 4%5 SBI General 9%




Raheja QBE reported Nil pending claims in Marine during the period

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MOTOR: CLAIMS SETTLEMENT EFFICIENCY RATIO


1 New India 83%2 United India 83%3 Oriental 79%4 National 63%


1 Bajaj Allianz 97%2 ICICI Lombard 96%3 Tata AIG 96%4 Royal Sundaram 96%5 HDFC Ergo 94%6 IFFCO Tokio 93%7 Bharti AXA 92%8 Cholamandalam MS 90%9 Reliance General 88%



1 Liberty Videocon 98%2 Universal Sompo 94%3 Future Generali 93%4 SBI General 89%5 Magma HDI 87%6 Raheja QBE 0%




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MOTOR: CLAIMS PENDENCY RATIO


1 Oriental 48%2 New India 53%3 National 56%4 United India 61%


1 IFFCO Tokio 31%2 Tata AIG 35%3 Bharti AXA 37%4 ICICI Lombard 38%5 Royal Sundaram 45%6 Cholamandalam MS 45%7 HDFC Ergo 48%8 Bajaj Allianz 55%9 Reliance General 65%



1 Raheja QBE 0%2 Magma HDI 4%3 Liberty Videocon 7%4 SBI General 21%5 Future Generali 30%6 Universal Sompo 37%




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HEALTH: CLAIMS SETTLEMENT EFFICIENCY RATIO

RANK INSURER CLAIMS SETTLEMENT EFICIENCY RATIO %

1 United India 99%2 New India 99%3 Oriental 98%4 National 55%

RANK INSURER CLAIMS SETTLEMENT EFICIENCY RATIO %

1 ICICI Lombard 100%2 Bajaj Allianz 100%3 Reliance General 100%4 SBI General 100%5 Cholamandalam MS 100%6 Royal Sundaram 100%7 HDFC Ergo 98%8 Future Generali 97%9 Tata AIG 94%

10 IFFCO Tokio 63%

RANK INSURER CLAIMS SETTLEMENT EFICIENCY RATIO %1 Bharti AXA 100%2 Universal Sompo 98%3 Liberty Videocon 98%



Magma HDI, Raheja QBE and Shriram General reported Nil paid losses during the period


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RANK INSURER CLAIMS SETTLEMENT EFFICIENCY RATIO %Apollo Munich 100%

Religare Health 100%Cigna TTK 100%

2 Star Heatlh 100%3 Max Bupa 100%


1

*Apollo Munich, Religare Health and Cigna TTK have paid all their claims reported within 3 months in the considered period

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HEALTH: CLAIMS PENDENCY RATIO


1 Oriental 1%2 New India 2%3 National 4%4 United India 5%


1 SBI General 0%2 Cholamandalam MS 0%3 HDFC Ergo 0%4 ICICI Lombard 1%5 Reliance General 1%6 Future Generali 1%7 Bajaj Allianz 2%8 IFFCO Tokio 3%9 Tata AIG 4%

10 Royal Sundaram 5%


1 Universal Sompo 0%2 Liberty Videocon 0%3 Bharti AXA 8%




Magma HDI, Raheja QBE and Shriram General reported Nil pending claims in Health during the period

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RANK INSURER CLAIMS PENDENCY RATIO%Apollo Munich 0%

Religare Health 0%Cigna TTK 0%

2 Max Bupa 0%3 Star Heatlh 0%


1

*Apollo Munich, Religare Health and Cigna TTK have nil claims outstanding for more than one year.

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MISCELLANEOUS: CLAIMS SETTLEMENT EFFICIENCY RATIO


1 New India 84%2 United India 73%3 Oriental 72%4 National 47%


1 Cholamandalam MS 99%2 HDFC Ergo 98%3 ICICI Lombard 92%4 Universal Sompo 90%5 Tata AIG 85%6 Bajaj Allianz 81%7 IFFCO Tokio 72%8 Reliance General 67%9 Future Generali 56%

10 SBI General 26%


1 Royal Sundaram 92%2 Magma HDI 86%3 Shriram General 72%4 Liberty Videocon 41%5 Raheja QBE 18%6 Bharti AXA 16%




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MISCELLANEOUS: CLAIMS PENDENCY RATIO


1 United India 2%2 Oriental 20%3 National 30%4 New India 31%


1 Universal Sompo 11%2 Tata AIG 13%3 ICICI Lombard 14%4 Future Generali 17%5 HDFC Ergo 18%6 Bajaj Allianz 20%7 SBI General 22%8 Cholamandalam MS 27%9 IFFCO Tokio 34%

10 Reliance General 44%


1 Magma HDI 0%2 Liberty Videocon 13%3 Bharti AXA 24%4 Shriram General 25%5 Royal Sundaram 26%6 Raheja QBE 27%




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The companies analyzed in this handbook have been mentioned, by the short nomenclature that they are popularly known by. The full names of the companies have been mentioned as a glossary below:

This handbook is intended to provide general information only and is not exhaustive. It is a policyholder awareness and education initiative and does not seek to give you any legal advice.

No information given herein replaces or overrides the terms and conditions of an insurance policy.

Please approach a duly licensed insurance broker or an insurance company registered with IRDAI for specific information regarding a policy or for any other additional information.

DISCLAIMER

GLOSSARY

PUBLIC SECTOR GENERAL INSURERS1 National National Insurance Co. Ltd.2 New India The New India Assurance Co. Ltd.3 Oriental The Oriental Insurance Co. Ltd.4 United India United India Insurance Co. Ltd.

PRIVATE SECTOR GENERAL INSURERS1 Bajaj Allianz Bajaj Allianz General Insurance Co. Ltd.2 Bharti AXA Bharti AXA General Insurance Co. Ltd.3 Cholamandalam MS Cholamandalam MS General Insurance Co. Ltd.4 Future Generali Future Generali India Insurance Co. Ltd.5 HDFC Ergo HDFC Ergo General Insurance Co. Ltd.6 ICICI Lombard ICICI Lombard General Insurance Co. Ltd.7 IFFCO Tokio IFFCO Tokio General Insurance Co. Ltd.8 Liberty Videocon Liberty Videocon General Insurance Co. Ltd.9 Magma HDI Magma HDI General Insurance Co. Ltd.

10 Raheja QBE Raheja QBE General Insurance Co. Ltd.11 Reliance General Reliance General Insurance Co. Ltd.12 Royal Sundaram Royal Sundaram General General Insurance Co. Ltd.13 SBI General SBI General Insurance Co. Ltd.14 Shriram General Shriram General Insurance Co. td.15 Tata AIG TATA AIG General Insurance Co. Ltd.16 Universal Sompo Universal Sompo General Insurance Co. Ltd.

STANDALONE HEALTH INSURERS1 Apollo Munich Apollo Munich Health Insurance Co. Ltd.2 Cigna TTK CignaTTK Health Insurance Co.Ltd.3 Max Bupa Max Bupa Health Insurance Co. Ltd.4 Religare Health Religare Health Insurance Co. Ltd.5 Star Heatlh Star Health and Allied Insurance Co. Ltd.

INSURANCE BROKERS ASSOCIATION OF INDIAMaker Bhavan No.1, 7th Floor, Sir V. T. Marg, Mumbai 400 020.

Tel. No.: 022 - 22846544 | Email: [email protected] | Web: http://ibai.org

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