Coimbatore, August 28-
Insurance is a promise made today for a need that may arise many years later. But there is only one moment when this promise is truly tested: when a claim is made. This is why claims settlement should not be seen merely as an operational metric, but as the currency of trust for a life insurer. It is also the single clearest measure of whether an insurer is fulfilling its fundamental purpose.

A life insurance policy may offer attractive benefits, competitive pricing and a seamless digital journey. But when a family loses a breadwinner, only one question matters: Will the insurer stand by the promise it made?

The importance of this question is growing as India’s insurance market expands. In FY2024-25, the life insurance industry collected premiums of ₹8.86 lakh crore, an increase of 6.73% over the previous year. Yet, life insurance penetration declined to 2.7% of GDP.

This contrast tells us something important. Growth in premiums does not automatically translate into wider protection. Customers must believe not only in the product they are buying, but also in the institution standing behind it.

Claims provide the strongest proof of that belief.

A claims paid ratio is, at its simplest, the percentage of claims an insurer pays during a year. But behind every percentage is a human story. It could mean that a child’s education continues, a home loan does not become a burden, or ageing parents remain financially secure. Most importantly, it gives a family the space to grieve without facing an immediate financial crisis.

For customers, a high claims paid ratio is an important signal. But consistency matters as much as one year’s performance. Customers should look at an insurer’s record across several years, along with the number and value of claims paid, the speed of settlement, the ease of the process and the quality of support provided to the family.

At Axis Max Life, our individual death claims paid ratio has remained above 99% for five consecutive years. It has steadily improved from 99.34% in FY2021-22 to 99.8% in FY2025-26, one of the industry’s leading claims paid ratios. In FY2025-26 alone, we settled 20,529 individual death claims worth ₹1,641 crore. The larger point, however, is not the number itself. It is what the number represents: a culture of keeping promises.

Claims also reveal the strength of an insurer’s entire organisation. A good claims experience begins with responsible underwriting. It requires accurate records, robust technology, clear communication, strong fraud controls and well-trained people. Above all, it requires empathy when a family is at its most vulnerable.