Claim Settlement Ratio
Claim settlement ratio (CSR) is health insurance is defined as the number of claims settled by an insurance company out of every 100 claim requests it receives.
Claim Settlement Ratio = Number of Claims Settled / Number of Claims Received * 100
For example, a claim settlement ratio of 95% means that out of every 100 claims received by the insurance company, 95 were successfully settled within the stipulated time.
Claim settlement ratio is an important metric which helps us in assessing the credibility of a health insurance company. The higher the claim settlement ratio, the better the insurance company. Generally, a claim settlement ratio of 90% or above is considered as good.
In most cases, health insurance companies settle claims partially, which is to say that the full amount claimed by the claimant is not settled. Hence, claim settlement ratio by number of policies does not provide complete information on the percentage of claim amount settled by the insurer.
To get a better picture of the claim settlement process and credibility of the insurer, look at the claim settlement ratio by the amount of claim. Claim settlement ratio by amount is the percentage of the total claim amount paid by the insurer compared to the total claim amount received.
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