According to the data released by IRDAI, Max Life Insurance has surpassed state-owned insurer Life Insurance Corporation (LIC) in terms of claims settlement ratio in Financial Year 2018. V Viswanand, Deputy Managing Director, Max Life Insurance, said that four years ago, 50 % of the rejected claims would be fraudulent claims and most of these fraudulent claims occur due to the lapses in the underwriting process. Viswanand further said that the many checks and balances have been introduced by insurer so as to strengthen the customer application and underwriting process. He further added that technology plays an important role in ensuring that we don’t have to deal with fraudulent claims later.
According to the data of IRDAI, Max Life Insurance settled 98.26% of individual death claims while LIC settled 98.04%. Tata AIA settled 98% claims while ICICI Prudential settled 97.88 percent claims. Fraudulent claims filed to Max Life Insurance have come down to the lowest percentage of the total claims (just 3 out of the total 173 claims rejected by the company were fraudulent claims).
The second big factor that has grabbed the attention and focus of the insurer is on affecting the claim settlement – non-disclosure of terminal illnesses. According to the annual report of IRDAI, LIC's market share fell below 70% in the financial year ended March 2018 as private insurers get more aggressive. From 28.19 percent in 2016-17, in the year in 2017-18, the market share of private insurers increased to 30.64%. The annual report said on the basis of total premium income, the market shares of LIC decreased from 71.81 percent in 2016-17 to 69.36 percent in 2017-18.