The sustenance, growth and development of organizations, to a considerable extent, depend on a few factors known as Key Success Factors (KSFs). In the insurance sector, the KSFs are product benefits, competitive premiums, products/plans differentiation through promotion and claims settlement. Among these different KSFs, claims settlement is the major factor for the success of LIC as its claims settlement operations are transparent and fair. The corporation looks for reasons to settle claims rather than avoid making payments on claims. In short, LIC's ability to withstand competitive pressure in the market can largely be attributed to its positive and proactive claims settlement operations.
An industry's key success factors (KSFs) are those competitive factors that most affect industry member's ability to prosper in the market place-the particular strategy elements, product attributes, resources, competencies, competitive capabilities and market achievements spell the difference between being a strong competitor and a weak competitor. KSFs by their very nature are so important to future competitive success that all firms in the industry must be competent at performing or achieving them. Hence, identification of KSFs should be the top priority of organizations to achieve sustainable competitive advantage. In the insurance sector, the key success factors are product benefits (bonus or guaranteed additions), competitive premiums, efficient distribution, products/plans differentiation through promotion and claims settlement. Among these different KSFs, claims settlement is the major key success factor due to the fact that prompt and timely settlement of claims help in enhancing the confidence of policyholders in insurance companies; thereby, the business of the latter will increase manifold.
Life insurance is essentially an instrument for providing financial compensation in case of unexpected death of the person taking the insurance cover. It means claims settlement is very important for insurance companies. Unlike tangibles, where it is possible to examine the product prior to purchase, the real test of insurance is after purchase-at the time of claims settlement. Claims can be classified into two types, Maturity claims, Death claims. The settlement of maturity claims is simple because the policyholder is alive and he or she can handle the problem, if any, directly. When it comes to settlement of death claims, it is somewhat complicated. This is because the policyholder may have a natural death or an unnatural death such as accident, murder, etc. In all these cases, required proof in terms of documents has to be submitted. If the insurer is satisfied with the proof, he will settle the claim or else he may further cross-check the information leading to delayed settlement of the claim. |
