What is the significance of claim settlement ratio for a health plan?
– Deepak Kumar
Claim settlement ratio is the ratio of number of claims reported to the insurance company to the number of claims settled in a year. A claim settlement ratio of 90% means that out of 100 claims, filed 90 claims are settled. Remaining 10% claims are either rejected or pending with the insurer. This has to be looked at before you buy any policy as it indicates probability of the settlement of your claim. Higher the claim settlement ratio, greater the chances of settlement of a claim. It is also a measure of the insurer’s reputation.

I have an insurance cover for my car which met with an accident very recently and is under insurance claim right now. What are the charges that will be deducted from the whole claim? The insurer is saying that I will have to pay for salvage. What are the salvage charges and how much do I have to pay?
—Gautam Dhir
Claim settlement in a car insurance is arrived at by taking into consider-ation many factors such as deductibles applicable, depreciation of the vehicle due to normal wear and tear and salvage value of the vehicle. Salvage value is the estimated cost of the vehicle that is paid when it is no longer useful. If your vehicle is completely damaged and repair costs exceeds the IDV of the vehicle then you can retain the salvage and insurer will settle the claim by taking into consideration IDV value less the salvage value of the vehicle and any other additional deductions as per policy. Salvage value can be arrived at by taking into account normal depreciation and market value of the vehicle before the accident.

What is a cancer protection cover and is it taken by an individual or a family?
—Ravi Kumar
Cancer protection covers are a special type of policy designed to offer financial assist-ance to individuals diagnosed with the disease. Cancer-specific policies offers lump-sum benefits for the insured to deal with various costs associated with cancer diagnosis and treatment, including hospitalisation, chemotherapy, radiation, surgery, etc. Newer policies provide monetary compensation, usually payable at various stages of cancer diagnosis like minor, major and critical stage. Though general insurance companies provide individual plans, there are some life insurance companies that provide family floater plans under cancer policies.

The writer is MD & CEO, Universal Sompo General Insurance. Send your queries to fepersonalfinance@expressindia.com