Summary of this article
Insurer complaint ratios offer better comparison than absolute grievance numbers
Claim rejection, partial settlement and delays reveal important service quality trends
Claim settlement ratio alone may not capture deductions or servicing problems
Irdai and Insurance Ombudsman data can help compare insurer complaint records
An insurer’s complaint record can help prospective policyholders understand how customers have experienced its services, particularly at the time of a claim. However, the total number of complaints alone may not say much about whether one insurer performs better than another.
A large health, life or general insurer with millions of customers can naturally have more complaints than a smaller company. Consumers therefore need to consider the size of the insurer’s business as well as the nature of complaints being reported.
Look Beyond Absolute Complaint Numbers
Complaint ratios can provide a more useful basis for comparison because they put the number of grievances in the context of the insurer’s policyholder base, policies issued or claims handled.
“A more meaningful comparison is complaints relative to the insurer’s policyholder base, policies issued or claims handled. Consumers should also look at the nature of these complaints, whether they relate to claim rejection, partial settlement, delays or servicing,” says Shilpa Arora, co-founder & COO, Insurance Samadhan.
Consumers should also avoid relying only on an insurer’s claim settlement ratio. A claim shown as paid does not necessarily reveal whether it was settled in full, whether deductions were made, how long settlement took or whether the customer had to escalate the matter repeatedly.
Complaint patterns relating to partial settlements, turnaround time and servicing can therefore add important context to claim settlement numbers. Repeated complaints over similar issues can be particularly useful in understanding the experience policyholders may face.
Which Complaints Matter Most?
Claim-related complaints deserve close attention because insurance is primarily intended to provide financial protection when an insured event occurs.
“Claim rejection should be one of the most important complaint categories for a consumer to examine because the fundamental purpose of insurance is to provide financial protection when a covered event occurs,” says Arora.
Apart from repudiation or rejection, consumers can look for complaints involving partial or short settlement, unexplained deductions, delays in processing claims, repeated requests for documents and servicing problems.
Rejection figures also need context. A consumer should examine why claims were rejected and whether similar reasons appear repeatedly across complaints rather than concluding the number alone.
Policyholders and prospective buyers can check Irdai’s published reports and grievance data, annual reports of the Council for Insurance Ombudsmen and disclosures made by individual insurers.
Looking at these sources together can offer a broader picture of an insurer’s record. Complaint ratios should not be the only reason for choosing or rejecting a policy, but they can be used alongside coverage, exclusions, pricing and claim-related information while comparing insurers.
FAQs
Should you avoid an insurer simply because it has a high number of complaints?
No. Larger insurers naturally receive more complaints, so consumers should compare complaint ratios relative to policyholders, policies issued or claims handled.
Which types of insurance complaints should consumers pay attention to?
Complaints involving claim rejection, partial settlement, unexplained deductions, processing delays and repeated documentation requests are particularly important.
Where can consumers check an insurer’s complaint record?
Consumers can refer to Irdai’s grievance data, Council for Insurance Ombudsmen annual reports and disclosures made by individual insurers.
