Insurance policy documents can require university-level reading abilities and even industry experts struggle to cut through the jargon, an investigation suggests.
Which? used readability software to examine the length of words and sentences in 40 policy documents from 10 major car, home, pet and travel insurers to estimate how well-educated a reader needs to be to understand them.
The watchdog said the average document was more challenging to read than Stephen Hawking’s A Brief History Of Time and Dostoevsky’s Crime And Punishment, suggesting this could cause problems for 43% of working adults with a reading ability of GCSE grade C or below.
In a separate snapshot investigation, the consumer group found a retired insurance professional, civil servants and software engineers were unable to answer all questions about two policy documents correctly.
It asked 24 people to read home and travel policy documents from six insurers and answer a number of questions such as how to make a claim and report a change in circumstances to test if they were practical to use.
On average, participants answered five out of 16 questions incorrectly when reviewing the travel insurance documents and three out of 12 incorrectly on the home insurance document.
Which? said it believed policyholders should be able to answer all questions correctly because any errors or misconceptions could leave them thousands of pounds out of pocket.
Participants answered a third of questions relating to Santander’s travel insurance policy incorrectly and approximately one in four for Axa and Insure & Go, while nearly a third of questions for Direct Line’s home insurance were answered incorrectly, one in four for Aviva and one in five for the Post Office.
Questions concerning when to report changes to a health condition were the toughest to answer, and participants failed this question two-thirds of the time, but participants also struggled with queries concerning home insurance contents cover over the Christmas period.
Which? Money editor Ceri Stanaway said: “Millions of insurance policies are bought every year, so it is worrying the policy documents are often far too complex for the average customer to understand, as our investigation suggests.
“Unclear insurance policies can have devastating consequences for customers, who could see their cover invalidated due to a misunderstanding.
“Customers can use their insurer’s glossary to make sense of complex terms, and should give their insurer a call if something is unclear, however, we want to see all insurance providers taking steps to cut out the jargon and make their policy documents easy for customers to get to grips with.”
Association of British Insurers spokesman Malcolm Tarling said: “No insurer wants confused customers. They continually review their customer communications, including policy documents, so that they are as clear and easy to understand as possible, while meeting strict regulatory and legal requirements.
“Anyone who is unclear on any aspect of their cover should always contact their insurer for clarification.”
A Direct Line spokesman said: “Our policy booklets have been designed to ensure they are easy to navigate, with clear headings and wording to help customers quickly find and understand the information they are looking for.
“If customers are unable to locate information or have any questions about their cover, our customer care teams are happy to help over the phone, via web chat or even Facebook and Twitter.”
Santander said: “As with all of our products, we are committed to making our insurance offering as simple for our customers as possible.
“The scenarios offered by Which? have been a helpful indicator of where the language used may be simplified for use in future.”
A Post Office spokeswoman said: “Our terms and conditions are reviewed regularly to ensure they are in line with regulatory requirements. We are of course always happy to listen to our customers’ feedback to make sure that our policies are fit for purpose.”