57% of COVID-19 claim remains unsettled

The data compiled by the General Insurance Council shows that general insurers are yet to settle and payout 57 percent of the COVID-19 claim amount.

According to the data, general insurance companies across India received a total of 5,53,188 policies for claims under COVID-19. Out of this, insurance companies have settled 3,92,718 policies which keep around 29 percent of policies outstanding and pending for settlement.

The number of outstanding policies may not look very big only till one finds out the amount of the pending claims behind these outstanding policies. The data further reveals that general insurers are yet to pay out around Rs 4,776 crore or 57 percent of the total Rs 8,444 crore worth of claims and this is estimated to be the amount behind the 29 percent pending policies waiting to be settled.

If one looks at the top five states as per COVID-19 claims, unsettled policies lie anywhere between 27-34 percent whereas unsettled/pending claims amount is between 56-60 percent.

According to industry sources, there is a widening lag between the unsettled policies and claims amount because of the slow settlement in some large ticket COVID-19 claims.

Insurance companies allege that hospitals have been discriminatingly overcharging patients who have a health insurance cover and hence insurers and looking into the details of these large claims.

General insurance companies have already made provisions for these COVID-19 claims and now the payout will reflect in their cash flows.