Sumit purchased a health insurance plan for his family and asked his friend Kaushal to check if he opted for a reliable policy or not. Kaushal, an insurance agent, asked him for information about his insurer’s Incurred Claim Ratio or ICR. Sumit told his childhood friend, after searching for it online, that it’s 38 per cent. This is where you went wrong, said Kaushal, adding that the insurer is either not incurring too many claims or not settling its claims. It may not be able to deliver the intended benefits to customers, he told Sumit.
“Purchasing a family health insurance plan suited to your specific needs, with an affordable premium is important. Equally important, however, is opting for the right health insurance firm that cares for you and your family in the long run,” Kaushal said.
What is Incurred Claim Ratio?
tually refers to the total amount paid by the insurance company to settle claims in a year with respect to the total amount collected by it as premiums from all its insured. Suppose an insurance company’s incurred claim ratio is 90 percent. It means that for every Rs.100 earned as premium, Rs.90 was spent on the claims settled by the firm. Therefore, the insurer earned Rs.10 as profit. If the amount paid by the company is more than the premium it received (ICR of more than 100 per cent), it means that the firm is running on a loss and it may not be able to settle claim requests in the future. However, if the ICR is too low (e.g., less than 50 per cent), then it means that the company is not paying enough in terms of settlements.
Therefore, the ICR of an insurance company should be between 70 percent and 90 percent. It establishes an insurance company’s ability to pay and its reliability. At 77.61 percent, Bajaj Allianz health insurance, available on Finserv MARKETS, enjoys one of the healthiest incurred claim ratios in the industry and offers a wide range of benefits to take care of you and your family. So, it is important that you check your insurer’s ICR before you apply for a family health insurance plan.
Though you can measure a health insurer’s performance through its incurred claim ratio, it is not a sole yardstick to judge the company’s overall health; other factors like claim settlement ratio (CSR) also contributes to a firm’s legacy.
Other factors to consider while purchasing health insurance
Claim Settlement Ratio: While ICR is the ratio of claims incurred by the insurance company to actual premium collected for that period, CSR is the ratio of settled claims against the total claims filed during that duration. Bajaj Allianz health insurance, available on Finserv MARKETS, offers exclusive benefits like swift claim settlement so that you do not have to think twice before availing the best medical care.
Claim Settlement Time: Another important factor while considering a family health insurance plan is to observe the claim settlement time by the insurer. It’s all about how fast a customer need is served in the time of hardship. A firm may have an ICR of 80 per cent or CSR of 90 per cent but if it’s taking a lot of time in the settlement process then it’s of no use. Bajaj Allianz health insurance, available on Finserv MARKETS, has one of the fastest claims settlement processes in the industry.
Network Hospitals: These days insurance companies offer a list of network hospitals they are affiliated with, making the hospitalization process easier. At these hospitals, insured can opt for cashless treatment. The process takes away the hassles of making upfront payments at the time of admission. A good health insurance company will have a long list of network hospitals. With Bajaj Allianz health insurance plans, available on Finserv MARKETS, you get access to its 6000+ cashless hospital network to avail the best treatment.
Free Medical Check-Up: While purchasing a family health insurance plan, you should look for a policy which offers a free medical check-up. However, this test/check-up does not affect the premium when policies come up for renewal.
Why Family Health Insurance Plan?
The premium payable for a family medical insurance plan is much cheaper compared to the premium payable for individual plans for each family member. Paying single premium, you can cover yourself, your spouse, kids and parents. Also, there are plans that allow you to cover your extended family too. Under family health insurance plans, you can also add a family member to your existing family health insurance policy without any hassle. Also, you can avail health insurance tax benefits of up to Rs.60,000 under section 80D of the Income Tax Act. You should feel comfortable with your insurance purchase. Do check the reputation of the insurer in the market. Also, make sure you understand the features and benefits of your family health insurance plan.