Simplicity is a major issue in the insurance issue. Many consumers have complained over the confusing nature of policies that are filled with language that even lawyers have trouble deciphering. As a result, many consumers end up skimming through policies and then ending up surprised to learn that the insurance they paid for does not cover the emergencies they need it for. A new survey from Siegel + Gale, a New York-based branding firm, shows that simplicity is an important issue for consumers in the same way that price is.
The survey ranks global industries based on the simplicity of their business schemes. According to the study, the insurance industry has finished dead last. The survey suggests that the insurance industry accounts for the majority of unhappy consumers throughout the world, largely due to the fact that policies are so difficult to understand, leading many consumers to file complaints against insurance companies. The survey found that consumers were willing to pay as much as 4% more for insurance policies that were easy to understand.
While consumers may want more simplicity in their policies, it can be dangerous for insurers to make things too simple. Cutting out words that are difficult to understand from policies could make the insurer liable in lawsuits because of the use of ambiguous language. While other companies like Netflix, Google and Amazon has little to no problem with keeping their terms of service easy to understand, the insurance industry cannot afford taking undue risks, especially when it is responsible for ensuring that people are protected from natural disasters, major illnesses and even economic catastrophes.