I recently ran across a blog article from a major news outlet that talked about the personal impact of a particular notice that the author had received from an insurance company regarding the disparity in the national tax treatment of same-sex couples and how it applied to their situation within the state of Illinois. One of the key phrases in the letter to policy holders said, “Pursuant to Section 3 of the Federal Defense of Marriage Act (“DOMA”), same-sex couples and civil unions are not recognized for the purposes of federal law. Therefore, the favorable income-deferral options afforded by federal tax law to an opposite-sex spouse under Internal Revenue Code sections 72(s) and 401(a)(9) and “spousal continuation” rights are currently not available to a party in a civil union.”
The blog went on to point out that this type of document blatantly shows what discrimination looks like, and how the mishmash of laws between the states and the federal government make things needlessly complicated for real people. It’s not just an abstract notion anymore when it affects you directly. Because of the data we track, we see these kinds of notices all the time. This dry legalese tone isn’t unique to this situation, and is actually quite common for all sorts of communication from every carrier. As someone who’s been in the industry a long time, I recognize this sort thing as standard boilerplate disclosure language and thus don’t take its dry tone personally, but unfortunately, for someone who is simply a policy holder and unused to dealing with this type of heavy detailed language, it can seem quite clinical and intimidating.
It got me to wondering why insurers so often communicate like this. Is it to step back and only inform without putting any kind of a slant on it? Perhaps so, but mostly I think it’s intended to be posterior-covering information intended to absolve the insurer from responsibility for the situation being what it is; almost as if to cry out to the consumer that regardless of the issue, “it’s not our fault!”
The questions I’m putting forth are these; why do insurers seem to only communicate through the dense wording of legalese? Political stance for this particular issue aside, why not soften the language, combine the notice with some sort of contextual piece, and perhaps a Q&A document? For sure cost is a factor for direct mail, but with so many consumers opting for “green” email communications, that’s fast becoming a non-issue. I’d propose that either they are either lazy, don’t care, or simply lack some sort of incentive to do things differently. Which do you think it is? Regardless of the reasons, in this season of making new-years resolutions, perhaps this is a good time for insurers to try to communicate at a more personal level and quit alienating their policyholders.