COMMENT: We need to talk about communication risk

Published in: Risk management, Conduct risk, Corporate strategy, Reinsurance, UK, Rest of Europe, US - Canada - Bermuda, ROW, People, Covid-19

Covid-19 has put the insurance industry’s reputation on the line, yet again. It has also thrust the subject of plain English into the spotlight.

Insurance is built on trust, where people expect straight answers.

Why then do we allow so much bunkum, hogwash and baloney to infiltrate the sector?

I see it in many places: insurance technology vendors are particularly fond of buzzwords I’m convinced neither they nor anyone has a clue what they mean.

It can happen in normal conversation when suddenly their eyes glaze over and they robotically trot out their company lines – before they reboot to plain English again.

My theory is the insurance tech experts are all sent to a desert bootcamp where they are drilled to repeat marketing gobbledygook – or die.

But the hokum has to stop!

As editor of InsuranceERM’s annual technology guide, I cut out plenty of flim-flam. Take a phrase like “fully functional”. What does it add? If a company is launching a product it is hardly going to be dysfunctional?

And can someone explain to me what are “in-the-box capabilities” and how they differ from “out-of-the-box capabilities”. I will offer a prize for the best explanation.

The advance of insurtech has upped the blarney further and this means everyone is “recontextualising plug-and-play architectures” or “transitioning scalable deliverables”.

It would be unfair to single out the techies for generating this mountain of malarkey, because everyone in the insurance and financial services sector is guilty of conversation or language that is pure trumpery.

Poor communication can be a risk with expensive consequences. Business interruption insurance policies have been exposed as having clumsy language could cost insurers millions in legal costs, not to mention lost trust from policyholders.

One major insurer who is being sued by businesses for allegedly not paying Covid-19 claims from recently admitted to me part of the problem was its policy terms were “too vague”.

That’s why precise use of language, clear communication, the importance of tone and plain English will all become much more important in insurance post-Covid-19.

The insurance industry should recognise this is an era when consumers are warned about “fake news” and trust is increasingly hard to gain and keep.

My message is this: Cut the claptrap, and deliver on your word.

On another note, InsuranceERM welcomes plain English submissions for our annual 2020-2021 technology guide.

A basic entry in the guide is free and at the discretion of the editorial team. If you wish to be considered for inclusion in InsuranceERM's 2020-21 technology guide, please email [email protected]

The deadline for entries is Friday 7 August. We also offer an enhanced listing, which includes more questions and an advertising package to showcase your offerings. Please contact Oli Henry if you would like more information on this option: [email protected] +44 (0) 20 3651 7208.

Ronan McCaughey