Payout by life insurance companies declined by about INR6,000 crore during 2022-23 because of lesser number of death claims as compared to previous financial year which was impacted by COVID-19. The life insurance industry paid a total benefit of INR4.96 lakh crore in 2022-23 as compared to INR5.02 lakh crore in FY22, according to the latest annual report released by sector regulator IRDAI.
During FY22, the year hit by COVID-19 wave, the insurance companies paid INR60,821.86 crore as death claims. This came down by INR19,000 crore to INR41,457 crore in 2022-23.
The benefits paid on account of surrenders/withdrawals increased by 25.62% to 1.98 lakh crore in 2022-23, of which public sector insurers accounted for 56.27 per cent.
During the year, out of the total surrender benefits, it said, benefits for ULIP (unit-linked insurance plans) accounted for 62.51% for private insurers and 1.56% for state-owned life insurers.
In case of individual life insurance business, during the year 2022-23, out of the 10.76 lakh total death claims, the life insurance companies paid 10.60 lakh death claims, with a total benefit amount of INR28,611 crore, the annual report said.
The number of claims repudiated was 10,822 for an amount of INR1,026 crore and the number of claims rejected was 4,340 for an amount of INR24 crore, it said.
The claims pending at the end of the year were 833 for INR350 crore, it said, adding, the claim settlement ratio of public sector insurers was 98.52% as at 31 March 2023 compared to 98.74% as at 31 March 2022.
The industry's overall settlement ratio decreased to 98.45% in 2022-23 from 98.64% in 2021-22, reported The Economic Times.