Browne Jacobson LLP, a UK-wide law firm with over 500 lawyers working across public and private sectors, has highlighted the “transformational impact” on its insurance policy services drafting offering following a collaborative project with the University of Nottingham. The results of researching exactly how baffling most policy wordings are, and then re-writing them to help consumers understand what they are buying, has been a giant step forward.
The University’s Linguistic Profiling for Professionals unit, which specialises in providing vital information on how the public use and interpret language depending on their levels of education, literacy, age, gender, ethnicity and social class, was commissioned by Browne Jacobson to enhance its policy drafting services.
The company teamed up with the University to find out what makes a policy document easy to understand, what impedes understanding, and share findings to improve practice across the industry. This followed recognition that the clarity and readability of policy wordings in the insurance market could be significantly improved.
A unique academic study examined the readability of a cross-section of insurance policies from across the market. The University’s linguistics researchers used eye-tracking technology to understand how people read policy documents in practice, analysed the reading difficulty using seven widely used readability metrics and applied its own further analysis, and tested readers’ understanding with comprehension surveys.
They then worked with Browne Jacobson to rewrite policies with repeated testing and analysis to test improvements to readability and comprehension. The findings were presented to a roundtable of industry participants with a series of five key drafting principles identified to improve effectiveness of policy drafting in the market.
With the Financial Conduct Authority (FCA) having released a directive for insurance firms to provide clearer and more transparent policy wording, the project has assisted in affirming Browne Jacobson’s position as the market leader in this field.
IE Note: This question of understanding exactly what is, and isn’t, covered is crucial and may form the crux of the argument regarding Business Interruption claims during the Covid-19 outbreak.
“Our collaboration with the University of Nottingham has raised the profile of the issue, and our profile as a firm specialising in insurance policy drafting services, together with a potential solution which cannot be provided elsewhere – this has proven to be a real USP,” said Tim Johnson, Partner at Browne Jacobson.
“This work has had a transformational impact on the drafting services we offer to our clients. Following the release of the report, we immediately received calls from insurers and other interested parties seeking more information about how we can assist with policy wordings. We have advised over 25 insurers and managing general agents (MGAs) on their insurance policy wordings, many of whom approached the firm specifically as a result of our work on policy readability with the University of Nottingham, and to take advantage of the linguistic services we are now able to offer through our unique partnership with the University.”
Browne Jacobson has used the report on clearer policy wording as a platform for stakeholder engagement. This has included a series of one-to-one briefings with existing clients; seminars with key industry participants including Lloyd’s of London (attended by over 100 individuals), the Managing General Agents Association (MGAA) and the Association of British Insurers; generating media coverage; and being shortlisted for leading insurance industry awards.
The firm has now signed a terms of engagement paper with the University of Nottingham, meaning that Browne Jacobson is able to offer the University’s linguistic services directly to its clients, as well as providing a platform for a deeper partnership. “We have benefitted greatly from the relationship,” Tim said. “The University has been business-like in its dealings and understood that our clients are looking for practical guidance rather than academic findings. The team has been absolutely brilliant and our clients are also getting value for money. There are opportunities for other parts of Browne Jacobson to work with the University and a number of discussions are currently underway.”
Tim also spoke about the how the relationship came about, praising the University’s flexibility and commercial acumen. “The University approached our learning and development team originally with a view to running some training for junior lawyers to draft with more clarity,” he said.
“I was brought into the meeting by our professional development lead who thought there may be an opportunity around insurance policy drafting, and we collectively suggested the academic study into policy readability as an idea. The University accommodated our proposal and was extremely flexible. It was fundamentally different from what they approached us to do and I was extremely impressed by their commercial awareness. In short, they responded to what we and our clients need.”
The study by the Linguistic Profiling for Professionals unit, published in May 2018, ultimately showed that insurers’ wordings generally remain unintelligible to the vast majority (approximately 87%) of the UK adult population. All policies tested had sections that caused comprehension difficulties – with most only comprehensible by graduates. They also identified practices that can systematically and significantly increase the overall readability and understanding of policy documents. The upshot of the improvements in readability is that the percentage of the UK adult population that could meaningfully understand the policy increased by some 75.6%, from 13.4% to 89%. That is an extra 40.4 million people in the UK.
“Our research outlines the issue of how insurance policies are incredibly difficult to understand yet consumer law requires legal agreements to be transparent,” said Kathy Conklin, Professor in Psycholinguistics at the University of Nottingham, who led the work with Browne Jacobson. “This means they need to be in plain, easy to understand language.
If legal documents are not written in plain English, then they may not be legally binding – or at least the parts that are not transparent will not be. So does this apply to those contracts you sign on a regular basis? And, if so, how do we measure how readable something is? This is why the work commissioned by Browne Jacobson is so important.”