Claim Settlement Ratio is the percentage of total insurance claims an insurer successfully settled (paid out) compared to the total number of claims it received during a given year, expressed as a single percentage figure. For instance, a claim settlement ratio of 98% means the insurer honoured 98 out of every 100 claims filed against its policies that year.
This ratio is one of the most important, publicly available metrics to check before buying a life insurance policy, since it's a strong indicator of how reliably an insurer actually pays out when your family needs it most — after all, a policy is only as good as the insurer's willingness to honour it. Insurance regulators publish these figures annually for all insurers, making it easy to compare companies before deciding where to buy your policy.