Cheat sheet
- During COVID’s deadliest year (FY 2021-22), insurers rejected only 1.03% of death claims by count. That’s the lowest rejection rate in seven years.
- After COVID, rejections climbed to 1.68% in FY 2024-25, the highest rate since at least 2018-19. The industry now rejects 17,333 claims a year, up from 10,069 pre-COVID.
- By amount, the picture is worse: insurers rejected 2.82% of claim value in FY 2024-25. Bajaj Allianz rejected 6.22% by amount despite rejecting only 0.68% by count.
- ICICI Prudential had a one-year spike to 4.46% rejection by count in FY 2022-23, then dropped to 0.66%. This pattern fits delayed non-disclosure investigations on pandemic-era policies.
- If you bought your policy during 2020-22, you’re in the window where non-disclosure investigations are most likely. The Section 45 moratorium (after 36 months, your policy cannot be questioned on any ground whatsoever) is your protection.
- All data from IRDAI Handbook on Indian Insurance Statistics (FY 2018-19 to 2024-25 editions).
Rejection Rate (Peak COVID)
FY 2021-22
Lowest in 7 years
Rejection Rate (Now)
FY 2024-25
+63% from COVID trough
Claims Rejected
FY 2024-25
+72% vs pre-COVID
IRDAI Handbook on Indian Insurance Statistics, 2018-19 to 2024-25 editions. Rejection rate = Repudiated / (Paid + Repudiated) by count.
If someone in your family died during COVID and you filed an insurance claim, you probably expected the worst. Social media was full of stories about insurers rejecting claims left and right. The reality, according to IRDAI’s own data, is the exact opposite.
During the two deadliest COVID years, insurers rejected a smaller share of claims than they did before the pandemic. The rejection rate dropped. But that’s only half the story. Since COVID ended, rejections have been climbing steadily, and FY 2024-25 recorded the highest rejection rate in at least seven years.
If you bought term insurance during or just after the pandemic, this matters to you directly.
The rejection rate dropped during COVID, then surged after
1.18%
1.30%
1.15%
1.03%
1.41%
1.64%
1.68%
IRDAI Handbook on Indian Insurance Statistics. Rate = Repudiated / (Paid + Repudiated) by policy count.
The pattern is clear. In FY 2019-20 (the last pre-COVID year), 1.30% of death claims were rejected. During the peak COVID year (FY 2021-22), when 16 lakh families filed death claims, that dropped to 1.03%. Since then, it has climbed every single year: 1.41%, 1.64%, and now 1.68% in FY 2024-25.
The reason the rate fell during COVID is straightforward. COVID deaths flooded the system with claims that had a clear, documented cause of death. There was no ambiguity about why the policyholder died. Insurers processed them quickly. The denominator (total decided claims) nearly doubled, while the number of rejections grew at a much slower pace. So the rate dropped.
What this means for you
The common belief that insurers used COVID as an excuse to reject claims is wrong. They actually rejected a smaller share during the pandemic. But if you bought a policy during 2020-22, your risk of rejection is higher now, not lower. Read on.
Why rejections are rising now
Three things are driving the post-COVID spike in rejections:
1. Pandemic-era policies are maturing into the investigation window. Millions of Indians bought life insurance for the first time during COVID. Many of those policies are now 2-4 years old. This is the period when insurers investigate early death claims most aggressively. If someone bought a ₹1 crore policy in 2021 and died in 2024, the insurer will scrutinise the application for non-disclosure of pre-existing conditions.
2. Non-disclosure catches up. During the rush to buy insurance in 2020-21, some applicants didn’t disclose health conditions. Some didn’t know they needed to. A blood pressure reading from 2019 that was never formally diagnosed, a family history of heart disease mentioned casually to a doctor but never recorded. Insurers dig into these during early claims.
3. The absolute numbers tell a starker story. In FY 2019-20, insurers rejected 11,189 claims. In FY 2024-25, that number is 17,333. That’s 6,144 more families denied their claim payout every year, a 55% increase. Even though the claims volume hasn’t fully returned to COVID-peak levels, the rejection count keeps climbing.
What this means for you
If you bought your policy during 2020-22 and are still within the first 3 years, make sure your application was completely honest. If you’re unsure whether you disclosed everything, don’t wait for a claim situation to find out. Review your proposal form now.
Which insurers rejected the most after COVID?
| Insurer | 2020-21 | 2021-22 | 2022-23 | 2023-24 | 2024-25 | Trend |
|---|---|---|---|---|---|---|
| LIC | 1.00% | 0.91% | 1.34% | 1.76% | 1.85% | Rising steadily |
| SBI Life | 3.93% | 2.77% | 2.74% | 1.38% | 1.17% | Declining from COVID high |
| HDFC Life | 0.85% | 1.20% | 0.59% | 0.46% | 0.29% | Now lowest among top 10 |
| ICICI Prudential | 1.95% | 1.79% | 4.46% | 0.80% | 0.66% | Massive spike, sharp correction |
| Max Life | 0.64% | 0.66% | 0.49% | 0.35% | 0.30% | Consistently low |
| Bajaj Allianz Life | 1.49% | 0.93% | 0.94% | 0.74% | 0.68% | Gradual decline |
| Tata AIA | 1.94% | 1.45% | 0.97% | 0.84% | 0.57% | Steady improvement |
| PNB MetLife | 1.83% | 2.61% | 0.91% | 0.80% | 0.43% | Spike in 2021-22, now lowest |
| Aditya Birla Sun Life | 1.79% | 1.86% | 1.88% | 1.51% | 1.26% | Slow decline |
| Reliance Life | 1.47% | 1.27% | 1.39% | 1.08% | 1.05% | Gradual decline |
IRDAI Handbook on Indian Insurance Statistics. Rate = (Repudiated + Rejected) / (Paid + Repudiated + Rejected) by count. Insurer-level data available from FY 2020-21 onward.
Two patterns stand out. LIC, which processes 84% of all death claims by count, shows a steady climb from 0.91% to 1.85%. Since LIC dominates the denominator, this single insurer drives most of the industry-level increase.
Then there’s the ICICI Prudential spike. In FY 2022-23, they rejected 4.46% of claims by count. That’s 638 rejections out of about 14,300 decided claims. By FY 2024-25, the rate collapsed to 0.66%. This pattern fits a concentrated investigation wave: ICICI Prudential appears to have flagged a batch of pandemic-era policies for non-disclosure review, rejected a cluster, and then returned to normal.
6.8x higher than their current rate
IRDAI Handbook on Indian Insurance Statistics, FY 2022-23 and 2024-25 editions.
What this means for you
Most private insurers have been improving their rejection rates over the past 3 years. The exception is LIC, where rejections are still climbing. If you have an LIC policy and are within the first 3 years, your disclosure accuracy matters more than ever.
Big claims get rejected at higher rates
The count-based rejection rate tells you how many claims get denied. The amount-based rate tells you how much money gets denied. The gap between these two numbers reveals something important: insurers reject high-value claims at much higher rates.
Look at Bajaj Allianz: 0.68% by count, 6.22% by amount. They reject very few claims in number, but the ones they do reject tend to be high-value policies. A family filing a ₹50 lakh or ₹1 crore claim faces different odds than one filing a ₹5 lakh claim.
Reliance Life is even more extreme in FY 2024-25: 1.05% by count, 7.63% by amount. HDFC Life shows a similar pattern (0.29% vs 1.86%), though at much lower absolute levels.
What this means for you
If you have a high-sum-assured policy (₹50 lakh or more), the amount-based rejection rate is the number you should care about, not the count-based CSR that insurers advertise. A 99% CSR by count can coexist with a 94% CSR by amount.
What you should do about this
If you bought your policy between 2020 and 2022: You’re in the highest-risk window for non-disclosure investigations right now. Pull out your proposal form. Check whether you disclosed all pre-existing conditions, medications, family history, and habits. If you missed something, talk to a financial advisor about your options. Some insurers allow supplementary disclosures.
If you’re buying a new policy now: Disclose everything. A condition you think is minor (borderline blood sugar, a mental health consultation, a tobacco habit you quit two years ago) can become grounds for rejection if you die within the first few years. The non-disclosure rules in Indian life insurance are strict. Under Section 45, no policy can be called in question on any ground whatsoever after 3 years. On a plain reading, this protection extends even to fraud, though the Supreme Court has not yet ruled on the 2015 amendment.
Check your insurer’s track record: The Insurer Scorecard shows rejection rates alongside CSR, persistency, and ombudsman data for all 22 insurers. If your insurer’s amount-based rejection rate is above 5%, that’s worth knowing before you buy.
Keep your policy documents accessible: 4,999 claims were pending at year-end in FY 2024-25, up from 458 the year before. Families struggle when they can’t locate the policy number, don’t know the nominee process, or miss claim filing deadlines. Read our guide to filing a death claim and share it with your nominee.
Frequently asked questions
Did insurers reject more claims during COVID?
No. The rejection rate by count dropped from 1.30% (FY 2019-20) to 1.03% (FY 2021-22) during the peak COVID period. Insurers processed the surge of COVID death claims without tightening rejection standards. The rate started climbing after COVID, reaching 1.68% in FY 2024-25 (source: IRDAI Handbook).
Why are insurance claim rejections rising after COVID?
Policies bought during the pandemic rush (2020-22) are now 2-4 years old, falling within the window when insurers most aggressively investigate early death claims. Non-disclosure of pre-existing conditions on these pandemic-era applications is the primary driver. LIC alone went from rejecting 9,465 claims in FY 2020-21 to 15,964 in FY 2024-25 (source: IRDAI Handbook).
Which insurer has the highest claim rejection rate?
By count in FY 2024-25, LIC has the highest rate among the top 10 at 1.85%. By amount, Reliance Life leads at 7.63%, followed by Bajaj Allianz at 6.22%. HDFC Life and Max Life have the lowest rejection rates by count (0.29% and 0.30% respectively). See the full comparison in the Insurer Scorecard (source: IRDAI Handbook FY 2024-25).
What is the 3-year moratorium rule in life insurance?
IRDAI mandates that after 3 years (36 months) from policy issuance, an insurer cannot deny a claim on grounds of non-disclosure. Section 45(1) states no policy can be called in question on any ground whatsoever after 3 years. On a plain reading, even fraud may be covered, though the Supreme Court has not yet confirmed this under the 2015 amendment. If your policy is past the 36-month mark, your family’s claim is protected from non-disclosure denials. This rule is in Section 45 of the Insurance Act, 1938 (amended 2015).
Should I worry about my policy if I bought it during COVID?
Only if your application was incomplete. Review your proposal form for any undisclosed conditions, medications, or habits. If everything was accurate, the rising rejection rate doesn’t affect your claim. Rejections target non-disclosure, not legitimate claims. If you’re unsure, consult a financial advisor about supplementary disclosure options.
Check your insurer’s full data profile: The Gyansurance Insurer Scorecard compares 22 life insurers across claims, persistency, ombudsman complaints, and solvency. All data from IRDAI.
Related data stories
Methodology
Data source: IRDAI Handbook on Indian Insurance Statistics, editions covering FY 2018-19 through FY 2024-25. Industry-level data from Table 14 (Individual Death Claims). Insurer-level data from Table 15 (Insurer-wise Individual Death Claims), available FY 2020-21 onward.
Rejection rate formula: Repudiated / (Paid + Repudiated) by policy count. This is the standard CSR complement used in IRDAI reporting. “Rejected” claims (a separate IRDAI category, primarily reported by LIC and HDFC Life) are included in the numerator and denominator.
Amount-based rate: Same formula applied to rupee amounts instead of policy counts. The gap between count-based and amount-based rates shows whether high-value claims are rejected disproportionately.
Insurer-level limitation: IRDAI data only contains insurer-level breakdowns from FY 2020-21 onward. Pre-COVID insurer-level rates are not available in the IRDAI Handbook. Industry totals cover FY 2018-19 onward.
CSR methodology: All Claim Settlement Ratios on this page use the IRDAI Handbook formula: Claims Paid ÷ (Claims Paid + Claims Repudiated + Claims Rejected), by policy count. Pending claims and unclaimed amounts are excluded from the denominator. Source: IRDAI Handbook on Indian Insurance Statistics.