There are a lot of things about insurance that can be confusing. It can be difficult to figure out what type of insurance you need, or how much of it you require in order to be properly protected. The wording on car insurance policies is also very confusing to many consumers, according to a recent survey.
A survey conducted by the Insurance Quotes website, with use of a Harris Interactive poll, found that more than one third of Americans who took the time to read over at least part of their auto insurance policy experienced confusion when trying to decipher it.
The survey itself was conducted online between February 24, 2011, and February 28, 2011. It included around 2,366 adults who were age 18 or older. Out of those adults, 2,107 of them said they were currently driving, and 2,079 said that they currently had an auto insurance policy.
A total of 87% of the drivers who took the survey said that they did, in fact, read at least some of their car insurance policy. This means that 13% of the drivers in the survey did not even attempt to read over their policy. Out of the 87% who did give it a try, 36% of them complained that their policies were “somewhat difficult” to understand, or were “very difficult” to understand.
People are having this much trouble figuring out what their car insurance policies actually say, despite recent efforts to make things easier to understand. More than 30 states have created laws that were intended to simplify the language used in car insurance policies. If consumers cannot understand what is in their policy, then there is no way for them to know, for certain, exactly what coverage they have.
Another problem with how auto insurance policies are written is that the language is above the “grade level” of the average consumer. The policies are not written in “plain English”. The average reading level for Americans is somewhere between seventh and eighth grade. Most insurance is written for higher level readers than that.
Certain words in car insurance policies are also a source of confusion. The word “comprehensive” is one that many consumers believe indicates that their car insurance is going to cover absolutely everything. Unfortunately, this isn’t the reality. Comprehensive car insurance only covers certain types of damages to your vehicle, and often, this type of damage is the kind that occurs outside of an automobile accident.
Collision coverage is what will help cover the cost of repairs to your car as a result of damages caused by an accident. Some people are dropping the collision coverage, because they incorrectly believe that all they need is “comprehensive” coverage.
Image by Valerie Everett on Flickr