why does LIC have better death claim settlement ratio?

POSTED BY Free Financial Calculators ON February 15, 2011 10:53 pm ONE COMMENT

Dear All,

Especially those who claim that if truth be told then death claim rejection is impossible, if this is the case then all claims that have been rejected so far contain something wrong in the application.

What I dont understand is why should LIC have better calim settlement then? After all if people are going to make mistakes in form filling it is likely that the % of problematic applications is the same for all companies.

We cant say people who take up LIC polices fill form more accurately than others! Since this is silly Why should LIC have better record in Death claim settlement!

One reply on this article “why does LIC have better death claim settlement ratio?”

  1. Dhawal Sharma says:

    @PATTU – Dear Sir, STATASTICS are what you make them out to be..LIC has REJECTION ratio of 1.5%..That means 1.5% of 1672720 (Number of POLICIES sold by LIC in the month of MAY) which comes out to be 25,091 for the month of MAY..Now I pick up the comparison with my company, KOTAK which sold 8514 POLICIES in the month of MAY..For your convenience, I’ll take the REJECTION RATIO at 6% which will comes out to be 511..

    Now I put the above DATA in this LENGUAGE – LIC rejected 25,091 policies in the month of MAY and KOTAK rejected 511 policies in the month of MAY then everybody [Including you, I am sure 😉 ] will select KOTAK..

    So this RATIO business is SILLY..

    LOGICAL answer is that because LIC sells policies with lesser SUM ASSURED than what most of the PRIVATE COMPANIES are selling (Generalization not specific) Plus LIC is in the market for last 60 years (Being a MONOPOLIST at that), they have such HUGE-HUGE surplus at their disposal, they can meet the claims (Which they themself know is not fair) without any hitch on the pretext of PUBLIC SERVICE and HUMANE GROUNDs whereas PRIVATE COMPANIES are new in the market and so most of the time, claims fall in EARLY CLAIM catagory (Claim within 2 years of the policy) which are met with STRONG INVESTIGATION and if found any abnormality/fraud/deceit, they reject the claim..

    Since LIC is zero on the scale of TRANSPERANCY (for eg, all private companies, when they sent the POLICY DOCUMENT to the PERSON, they include the PHOTOCOPY of PROPOSAL FORM along whereas LIC just sent 4 page booklet with no photocopy of PROPOSAL FORM), one has to be very careful with the procedure..PER KOI BAAT NAHI, SARKARI COMPANY HAI, SAB CHALTA HAI 🙂

    DATA SOURCE:
    http://www.irda.gov.in/ADMINCMS/cms/frmwhats_List.aspx

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