LIC Claim Settlement Ratio: Guide

Overview

Life Insurance Corporation of India (LIC) reported a claim settlement ratio of 98.16% (three-year average, FY 2024-26), based on its public disclosures and IRDAI data.

Understanding LIC's Claim Settlement Ratio

Definition: The Claim Settlement Ratio (CSR) measures the share of death claims an insurer pays out against the total claims it processes in a financial year. It is calculated as claims paid divided by claims paid, repudiated, and rejected.
Reliability: A ratio of 97% or higher is considered strong and dependable. LIC's figure comfortably clears this mark, even though several private insurers now edge past 99%.
Beyond CSR: Since CSR only counts the number of claims settled, not their value, it is worth checking alongside the Amount Settlement Ratio (ASR), complaint volume, and solvency ratio. LIC scores well on all three, with a 95.48% ASR and lower-than-average complaints per 10,000 claims.
Details: Verified CSR data is available through IRDAI's annual reports and LIC's Form L-40 disclosures.

Life Insurance Corporation of India (LIC), established in 1956, is India’s largest life insurer by total first-year premium income. As of March 31, 2025, LIC managed total assets worth approximately ₹56.23 lakh crore, held a 57.05% market share in total first-year premium income, had 2,048 branch offices, and worked with more than 14.86 lakh agents.

When buying a life insurance policy, one question matters above everything else: will LIC actually pay my family’s claim? That is exactly what the CSR helps you understand.

What Is a Claim Settlement Ratio?

A Claim Settlement Ratio (CSR) represents the percentage of death claims an insurer successfully settles out of the total claims it was required to process in a given financial year. It is the single most cited metric for judging how reliably an insurer pays up.

For instance, if LIC receives 10,000 death claims and settles 9,815 of them, its CSR for that year is 98.15%. The higher the ratio, the more dependable the insurer is generally considered to be.

How To Interpret CSR:

97% and Above: Indicates a strong, efficient, and highly reliable insurer with a high claim settlement track record.
90%-97%: Most claims are settled, but you should review other metrics before deciding.
Below 90%: May signal higher chances of delays, rejections, or an inconsistent claims experience.

Note: LIC's CSR for FY 2025-26 sits in the 'strong' range. While a handful of private insurers now cross 99%, LIC's performance across over 8 lakh claims per year makes its ratio especially meaningful.

Want to go beyond the interpretation? Ditto Data Lab features detailed term insurance data from insurers and IRDAI, collected from official sources and curated by our team.

How to Calculate the LIC Claim Settlement Ratio?

Here's how the LIC claim settlement ratio is calculated:

Claim Settlement Ratio = Claims Paid ÷ Claims Processed × 100

For LIC’s FY 2025-26 individual death claim data, claims processed broadly include:

Claims paid
Claims repudiated
Claims rejected

Pending claims should be reviewed separately because they indicate settlement delays, not claim denial.

So, for LIC, the broad calculation is:

CSR = Claims Paid ÷ (Claims Paid + Claims Repudiated + Claims Rejected) × 100

This gives LIC a claim settlement ratio of 98.10% for FY 2025-26.

At Ditto, we recommend evaluating CSR alongside other key metrics such as the Amount Settlement Ratio (ASR), complaint volume per 10,000 claims, Gross Written Premium (GWP), and solvency ratio. This is because CSR only tracks the number of claims settled, not the value. An insurer could settle a high volume of smaller claims while disputing larger ones, resulting in a high CSR but a low ASR. Looking at multiple metrics together gives a more accurate picture of an insurer’s true claims reliability.

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Where Can I Find the Claim Settlement Ratio for LIC?

You can check the LIC claim settlement ratio from the following verified sources:

IRDAI Annual Reports or Handbook on Indian Insurance Statistics, published annually on irdai.gov.in, around December for the preceding financial year.
Life Insurance Corporation of India Public Disclosures (Form L-40), available on licindia.in under the Investor Relations or Financial Disclosures section.
Ditto Insurance, which provides regularly updated CSR data verified against IRDAI sources, along with expert context and insurer comparisons.

LIC: 3-Year Claim Settlement Ratio and Other Metrics

Metrics (Average of FY 2024-26)	LIC	Industry Average
Claim Settlement Ratio (CSR)	98.16%	99% (Mean)
Amount Settlement Ratio (ASR) (Average of FY 2023-25)	95.48%	94.83% (Mean)
Average Complaints Received Per 10,000 Claims	4.34	13.10 (Median)
Annual Business / Gross Written Premium (in Crores)	₹236,689.82	₹3,778.58 (Median)
Solvency Ratio	2.15x	2x (Median)

Note: All this data is sourced from IRDAI annual reports and the insurer’s public disclosures.

Key Insights

CSR: Despite handling the highest individual death claim volume in India, LIC maintains a CSR consistently above 97%, a stronger reliability indicator than the marginally higher CSR achieved by insurers operating on a much smaller scale.
ASR: LIC's amount settlement ratio is higher than the industry average, indicating that not only are claims being settled, but a larger proportion of the claim value is being paid out.
Complaints: LIC records significantly lower complaint volumes per 10,000 claims compared to the industry median, suggesting a relatively smoother claims experience and fewer disputes during settlement.
GWP: LIC collects the highest gross written premium among all life insurers in India, reflecting both its scale and the sustained trust of its policyholder base.
Solvency ratio: LIC maintains a solvency ratio of 2.15x, broadly in line with the regulatory requirement. This indicates that the insurer holds adequate capital buffers to meet future claim obligations comfortably.

Top 10 Term Insurance Providers by Claim Settlement Ratio

Company Name	CSR (FY 2023-24)	CSR (FY 2024-25)	CSR (FY 2025-26)	CSR (FY 2024- 2026)
Axis Max Life Insurance	99.65%	99.70%	99.78%	99.71%
HDFC Life Insurance	99.54%	99.71%	99.72%	99.66%
PNB MetLife India Insurance	99.20%	99.57%	99.81%	99.53%
Canara HSBC Life Insurance	99.31%	99.43%	99.52%	99.42%
Tata AIA Life Insurance	99.16%	99.43%	99.48%	99.36%
Bajaj Life Insurance	99.26%	99.32%	99.38%	99.32%
Pramerica Life Insurance	99.19%	99.31%	99.41%	99.30%
Edelweiss Tokio Life Insurance	99.23%	99.29%	99.31%	99.28%
Bandhan Life Insurance (Formerly Aegon Life Insurance)	99.66%	99.73%	98.15%	99.18%
Bharti AXA Life Insurance	99.01%	99.18%	99.21%	99.13%

Key Insight: Even with a 3-year average CSR of 98.15%, Life Insurance Corporation of India narrowly misses the top 10 list, primarily because private insurers now consistently exceed 99%. However, LIC's performance at its massive claim volumes remains genuinely impressive and should not be discounted when evaluating its term insurance claim settlement reliability.

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Ditto’s Take

LIC is one of the largest and most trusted life insurers in India. Its consistent claim settlement ratio, low complaint volume, and government backing make it a dependable choice for those who prioritize reliability above all else. On the downside, premiums tend to run higher and product flexibility is limited compared to leading private insurers, which is worth factoring in before you decide.

Overall, LIC is a solid, time-tested insurer with a claims track record that holds up well given the sheer scale at which it operates.

If you'd like to see how the insurer compares with other leading insurers, check out our detailed guide on the best term insurance plans in India.

Frequently Asked Questions

What is LIC's claim settlement ratio for FY 2025-26?

LIC's claim settlement ratio for FY 2025-26 is 98.10%. This is calculated by dividing claims paid by the total of claims paid, repudiated, and rejected. Pending claims are excluded from this calculation because they reflect delays rather than denials. Over a three-year average spanning FY 2024-26, LIC's CSR stands at 98.16%, placing it firmly in the strong and reliable category used across the insurance industry.

How is the claim settlement ratio calculated?

The claim settlement ratio is calculated as claims paid divided by claims processed, multiplied by 100. Claims processed includes claims paid, claims repudiated, and claims rejected. Pending claims are reviewed separately since they signal settlement delays rather than outright denial. This formula gives a clear percentage showing how often an insurer actually pays out the claims it receives.

Is LIC's claim settlement ratio good compared to other insurers?

Yes. LIC's average CSR of 98.16% falls in the strong range, though it narrowly misses the top 10 list dominated by private insurers like Axis Max Life and HDFC Life, which cross 99%. However, LIC processes over 8 lakh claims annually, a scale few competitors match, making its consistency especially significant.

What is the Amount Settlement Ratio and why does it matter?

The Amount Settlement Ratio (ASR) measures the value of claims settled, not just the number. LIC's ASR is 95.48%, higher than the industry average of 94.83%. This matters because CSR alone can be misleading. An insurer could settle many small claims while disputing large ones, producing a high CSR but low ASR.

What is LIC's solvency ratio and what does it indicate?

LIC's solvency ratio stands at 2.15x, slightly above the regulatory and industry median benchmark of 2x. This indicates LIC holds adequate capital buffers to comfortably meet future claim obligations. A healthy solvency ratio signals financial stability, reassuring policyholders that the insurer can pay claims as they arise.

Should I rely only on CSR when choosing a term insurance provider?

No, CSR should not be the only metric you consider. Ditto recommends evaluating it alongside the Amount Settlement Ratio, complaint volume per 10,000 claims, gross written premium, and solvency ratio. Looking at these together gives a more accurate and complete picture of an insurer's true claims reliability.

How large is LIC compared to other life insurers in India?

LIC is India's largest life insurer, managing total assets of about ₹56.23 lakh crore as of March 2025. It holds a 57.05% market share in first-year premium income, operates 2,048 branch offices, and works with over 14.86 lakh agents, reflecting its unmatched scale.

Last updated on: 1 Sep, 2026