ProtectionAug 26 2016

Policyholders in dark about 19k word life cover

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Policyholders in dark about 19k word life cover

Policyholders ignore almost all of the vast reams of information sent to them by insurance companies, leaving people in the dark about their cover.

Research by insurance company SunLife found the average set of insurance documents contains around 19,000 words of explanation, with some reaching 25,000, laid down in difficult to understand “PhD level” language.

As a result, 85 per cent of policyholders are ignoring the information sent to them by providers, its research found.

While the average reader should take around two hours to understand the average car insurance policy and between three and three and a half to understand the average life, health, home and travel insurance documents, consumers are actually spending just 27 minutes.

This means they are skimming through the vast majority of the text and reading just 15 per cent of the content, meaning millions of people may not know much about the cover they are paying for.

“Over three hours’ worth of reading – often written in complex language – feels like a big commitment to have to make every time you buy an insurance product,’ SunLife’s head of brand Ian Atkinson said.

“It’s important to have a good idea of what you are and aren’t covered for, but it’s understandable that typically people don’t want to spend more than half an hour reading about their insurance.

“That’s why we are working hard to make insurance documents shorter and simpler to understand.”

SunLife has trimmed down its information documents to 4,500 words.

laura.miller@ft.com