A life
insurance policy is a simple product. The customer is invited to purchase
it, usually in installments called premium. If he dies/suffers a critical
illness/is disabled, the insurance company pays him a claim. That’s it.
In contrast, a mobile phone is an amazingly
complex product. You can communicate, take photos, browse the internet, play
games and do a hundred other things.
Let us look at the sales brochures of the
two products. A mobile phone company has a neat leaflet that lists the features
in small print, and has glitzy photographs.
Life insurance policy brochures are 6 to 15
pages, legally worded and full of jargon. The impression is that the companies are
more interested in protecting themselves than selling their wares. In their
endeavour some companies have forgotten to ask one simple question: Does the
ordinary prospect understand what is written?
We presume that the brochure exists to
educate the prospect who has in his mind to buy insurance. The ordinary
prospect has little patience in reading material that cannot be understood at
first glance, and he certainly has no desire to decipher the meanings of
abbreviations – or double brackets.
If language does not match intention, the
result is confusion.
Sometimes regulations force companies to
disclose features. The following example reveals what happens when no company
bothers to simplify what essentially is a regulatory diktat.
What exactly is a non-negative claw-back
addition? Individually the words mean “positive-withdraw-add”. Every life
company has this clause in every brochure. I am sure it can be worded in a
manner that makes sense to an ordinary human being, without losing the essence
of what is actually a powerful customer friendly mandate from IRDA.
When I read the following paragraph, I got
lost in the jungle of lock-in periods and calendar days.
This is a sample, and there are hundreds of
brochures from 24 life companies. Some are better than these, many are not.
Insurance companies must simplify their offerings and their language.
Ill-informed customers are a good to no one.
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