A study by the University of Nottingham and law firm Browne Jacobson showed every policy needed at least A-Level education to be understood

Nearly 90% of the UK adult population cannot fully understand their insurance policies.

A study by law firm Browne Jacobson, in partnership with the University of Nottingham, found that the least readable policy it reviewed could only be understood by 13.4% of UK adults.

The news follows US insurtech Lemonade recently announcing they plan to scrap traditional policies with ones simpler and more relevant.

The study looked at the wording of standard buildings and contents insurance policies aimed at small businesses.

It found that all reviewed policies needed at least A-Level education, with most needing a graduate or post graduate level.

Some even needed a doctorate level of education to be fully understood.

The study found that policyholders often found it difficult to understand what is and what is not covered when given real-life scenarios. Policy comprehension ranged from between 32% and 66%.

Long sentences

Louise Mullany, a professor of linguistics at the university said: “It is partly the length of sentences — there’s a tendency to use very, very long sentences.

“There is also a tendency to use uncommon words such as ‘subterranean’ to mean ‘underground’”.

However, the study also revealed that by applying the drafting methodologies summarised, it is possible to significantly improve the readability of policies.

For example, it was possible to reduce the reading age of one policy by 10 years from doctorate level to that of a 12-13 year-old.

Browne Jacobson says this can increase the percentage of the UK population that could understand the policy by some 75%, from 13.4% to 89% (40.4m people).


According to the National Literacy Trust, 1 in 7 adults in England (5.1 million people) are ‘functionally illiterate’ and would not pass an English GCSE.

And according to the Joseph Rowntree Foundation, 1 in 20 adults have the reading age of a 5-year-old.

Stuart Clarke, head of technical claims at Hiscox UK and Ireland reacted to the findings, saying: “Words that I’d assume that people should know… this study is really reminding me that they don’t.”

Overall, the study shows that much can be done to improve the readability of policy wordings, and that there are significant benefits available for those insurers that do so.

Browne Jacobson said: ”It will be interesting to see how the market responds to increased knowledge about how individuals read and understand policy wordings.”