Retirement savers can expect some plain talking from pension providers after the companies have reviewed and rewritten thousands of documents to make understanding financial jargon easier for consumers.
Consumers have repeatedly claimed their pension paperwork is too complicated and sprinkled with words and initials that are confusing for them – especially when they are trying to find out about pension freedoms.
Trade body the Association of British Insurers (ABI)says the industry has spent two years simplifying and streamlining documents and forms.
One firm has edited 800 documents to make them easier for consumers to read, while others have made their paperwork clearer after collaborating with the Plain English Campaign.
Softer language for worried consumers
And the changes will carry on as the ABI has commissioned research aimed at replacing technical jargon with easier to understand words and phrases and customised icons and animations.
Other changes include:
- Softening language that might worry consumers, such as changing “We have some warnings we need to give you” to “We want to help you make sure you’re doing the right thing”
- Contacting customers up to five years before they retire, rather than six weeks before
- Replacing jargon and unnecessary technical language with visual metaphors and animations. One firm is using an apple tree as a metaphor for a growing pension pot and withdrawal options.
Rob Yuille, head of retirement policy at the ABI, said: “It’s been widely acknowledged by the industry, regulators and government that pensions jargon is far too confusing for everyday consumers – even more so with the advent of pensions freedoms.
Less daunting and more personalised information
“The work being done by the industry to simplify and humanise the language used in retirement communications will give people more confidence and reduce anxiety when they come to making important decisions about their financial future at retirement.”
The ABI has led the industry on a path of making documents and financial information clearer.
“Consumers approaching their retirement should now be presented with simpler documents and information that will make their decision-making process a lot smoother, less daunting and more personalised – helping to create better retirement outcomes for all,” said Yuille.