You might be forgiven for thinking that the powers-that-be in Brussels are doing their best to enforce legislation upon us before Brexit. The latest set of rules can be found in the Insurance Distribution Directive (IDD), which affects all forms of general insurance from 1st October 2018.
Ever since we issued our first policy in 1994, we’ve prided ourselves on our straightforward and easy-to-understand wordings. We’ve always felt it was important that our documentation is written in plain English, made as clear as possible.
So we welcome the latest initiative from the European Commission. From October 2018, as part of the IDD, every policy will have to include an Insurance Product Information Document (IPID); it’s a new-look summary of cover that will be applied to all insurance products.
The thinking behind the IPID is that it will make it easier for all policyholders to see what is, and isn’t, covered, along with any restrictions or obligations. The IPID has a standard format, which should make it easier for you and your clients to compare different companies’ products before deciding which policy to purchase, without just focusing on the price.
As early and vocal proponents of clear policy documentation, we’re delighted to support anything that makes insurance easier to understand. We’ve already made changes to our policy documentation to align with the new standards, and we’ve taken the opportunity to review and update the general layout of our wordings.
The IPID is a change to the documentation, but not to the cover being provided; the protection for your clients won’t be affected at all. But, because the IPID provides an overview of the cover, it will replace our policy summary.
The first thing you’ll probably notice is that the IPID is very colourful! That’s because an IPID needs to use certain symbols to provide a visual indicator as to what each section is about, so it’s easy for a policyholder to both identify and compare similar sections.
You’ll also notice that the sections are titled using questions. The way these questions are phrased is dictated by the IDD, and you can see that they’re in clear and plain English.
Although the IPID replaces our policy summary, the essence of the document is the same: it gives an overview of the cover being provided without going into too much detail, and places the most important information in the insured’s hands, up front.
And while our policy wordings look a little different too, don’t worry; the content hasn’t changed. Our policy wordings are already written in plain English, and contain the same information, under the same headings that you’re used to, and now, in the new format, you should find them even easier to understand.
We’re always working hard to make sure our documentation is as clear and concise as possible, so we’re delighted that the IPID is going to help us with that goal. If you have any questions about how our policy documentation has changed, or about any our policies, please contact one of our experts.