Plain English Contract Editing
So many of the contracts letters and forms used in insurance and banking are poorly written, the victims of decades of accumulated legal-ese, which tends to pile up like plaque in your arteries.
For those who don’t eat legal-ese for breakfast, it’s like a foreign language. People are wary of insurance and banking contracts, which are traditionally littered with clauses, sub clauses, caveats and confusing provisions. Importantly, this is not without good reason because banks and insurance companies don’t want to be any more exposed to risk than they plan to be. But, with skilful editing, these contracts can be relieved of their burden, and transformed into clear, honest, and simple documents that carry the same legal gravitas but not the fog.
Banks, insurance companies and others spend millions building-up trust with their customers. The transparency and ‘honesty’ that plain English contract editors bring to a contract, and for that matter general communications, are valuable, elusive brand assets.
Here’s a few before and after examples from our plain English contract editing.
Before: A policy may be canceled by an insured person (the insured person) by providing the Company with a written notice of said cancellation. The serving of said written notice of cancellation is sufficient and will suffice in making effective the date of cancellation of the policy in the notice of cancellation. That being the end of the policy term, and hence its completion, the said policy will henceforth be cancelled.
After: To cancel your policy, simply write to the Company outlining when you want it cancelled.
Before: DISCLAIMER: This article is only intended to be a guide only with respect to some of the matters to consider when starting your own business and is not intended to be a substitute for obtaining legal or other expert advice. No responsibility is accepted for any action taken as a result of any material in this article. Information and advice relating to your specific commercial dealings can be obtained by contacting us.
After: DISCLAIMER: We don’t accept responsibility for any action taken from reading this article as it’s intended as a guide only. It’s not a substitute for expert legal advice. Contact us for more
Before: The Insurer herein shall not be deemed to provide cover and the Insurer herein shall not be liable to pay any claim or provide any benefit hereunder to the extent that the provision of such aforementioned cover, payment of such claim or provision of such benefit arises as a result of the Insured person or persons behaving contrary to the law or laws within the borders of the country in which they are travelling at the time.
After: Break the law in the country you’re travelling in and we won’t cover you.
Before: As per your formal request for a review of your new retail lease on May 7 we must bring your attention to the fact that despite the significant amount of time that has elapsed since you made this request we are yet to secure a copy of your original agreement which we will need to conduct this review. In mind of the fact that the deadline for resigning is imminent we would esteem it greatly if you would determine the location of, and furnish us with, the original lease agreement forthwith so that we may review as directed by you as soon as possible.
After: On May 7 you asked us to review your new retail lease but we’re yet to get a copy? With the deadline for resigning fast approaching we’ll need it as soon as possible.
The Brand Advantages Of Plain English Contracts
When we meet a stranger, we have one fundamental question — “are they friend or foe?” Everything follows from that decision.
The same goes for what we read, writes Andrew Pegler. When language is obscure, it promotes doubt. Doubt leads to hesitation and fear of engagement. In other words, if you’re selling something or offering a service, don’t open the relationship in a way that creates suspicion.
An act of God?
Rightly or wrongly, the public regard the insurance, banking, legal and financial services industries with suspicion. This is the result of many years of — in the view of some — obfuscatory legal contracts which lead to misunderstandings or misplaced expectations.
The impact of these essays in obfuscation was highlighted after the 2010–11 floods in Queensland, Australia which covered an area the size of Germany. A flood is known in the business as an act of God. Legal obscurantists call it a “force majeure”.
Swathes of devastated home owners had their claims rejected due to the fine print in their product contract which made a distinction between what was an act of God (a flash flood), a riverine flood (a river that broke its banks) or an act of Mammon (blocked stormwater drains). The consequences of this lack of clarity caused a huge uproar across the nation, inflicting a trust deficit on the insurance industry that it is literally still reeling from.
The same problem faced many victims of Australia’s “Black Saturday” bushfires in 2009. Houses on one side of the street were covered, houses on the other were not. The devil lay in the fine print.
Then there’s banking contracts that impose unexpected penalties, fees or risks that might see your house being sold from under you. Or what many perceive as the “hidden costs” of putting your life savings in a managed fund. The royal commission will no doubt get there.
Lack of clarity creates a vacuum, and into this void steps mistrust and wariness. Banks, insurance companies and financial planners now realise that if they wish to conduct business in a way that benefits everyone, they must be more transparent in how they provide services. So they spend multiple millions on advertising, attempting to reassure the public that they are worthy of trust.
- That they can be trusted with your life savings
- That they can be trusted to help when a 100km gust knocks a tree through your roof
- That they can be trusted to get you the best yield for your retirement nest egg with minimum risk
However, spending millions to amplify the message that you’re trustworthy is unlikely to commit an organisation to genuine change and, unsurprisingly, the public has become more circumspect.
The precarious relationship between suspicion and trust
For the public to feel confident, there must be nothing to make them suspicious.
Trust is fleeting. Very fleeting. And the relationship between suspicion and trust is highly precarious. In fact, suspicion hangs like the sword of Damocles over trust.
Damocles pontificating about the advantages of plain English contracts
One day a bloke called Damocles exclaimed to his king that he was truly fortunate to enjoy such power and authority and be surrounded by such opulence. The king offered to switch places with Damocles and Damocles quickly accepted.
But there was a kicker.
As Damocles sat in the king’s throne surrounded by luxury and power, he saw that the king had arranged for a huge sword to hang above him. It was attached to the roof by a single horse’s hair. Damocles soon wanted out, finally realising that with great fortune and power comes also great danger.
This myth shows the perilous nature of things. Like the sword of Damocles — suspicion is constantly hanging over trust, ready at any moment to put trust to death.
Suspicion is trust’s kryptonite. Its nemesis. Its Lex Luthor. A precarious relationship indeed. Yet without doubt, trust is about the most valuable brand asset any bank, insurer, law firm or financial planner can own.
Enter plain English
Large investment by organisations in advertising their trustworthiness is not working. Why would it? People need something tangible to truly feel comfortable depending on their service providers. One of the best ways to create real trust is with plain English. Free from embellishments, obfuscations and artifice, plain English can play a unique role in building trust; eliminating the mortal threat posed by suspicion.
Does anyone really think Joe/Joanne public know that “force majeure” means unavoidable events? Other old-fashioned words such as “aforementioned” and “thereto” are also traditionally used in legal drafting. They can, and should, be avoided.
Lawyers should talk to people in ways they understand and can act upon with confidence. This is called plain English. Put simply — or dare I say it plainly — plain.
Plain English is writing something in a way that gives someone a good chance of understanding it at the first reading. And in the way that you as a lawyer wants them to. It’s clear, direct writing, using as few words as you need; avoiding ambiguity, verbage and complex sentences. In other words, short, simple and human.
Insurers, bankers, financial service providers and lawyers who recognise the advantages of plain English are on the front foot in differentiating themselves from competitors.
The matter of ethics also comes into play. It is a fundamental requirement that a legal contract be easily understood — not only by the lawyers who have prepared it, but by those who will be bound by its terms. The use of unclear or overly fancy language just leads to confusion about what exactly the parties’ obligations are. In some cases, this uncertainty leads to court proceedings — which lead in turn to even more complicated language!
Right now, any company that uses plain English in its products has a jump on competitors, as there are surprisingly few doing it.
The opportunity to shore up the elusive and highly valued brand asset of trust is very real. The marketing case for plain English is self-evident. Plain English will go a long way towards putting you beyond all reasonable doubt and beyond the brand dangers of consumer suspicion.
Let me demonstrate with samples of some of my company’s recent work:
Before: We agree to provide the Cover described in this Policy upon full payment of the gross premium as stated in the Schedule. If full payment of the gross premium as stated in the Schedule is not made, there is no Cover. Therefore the individual applying for the Cover is not covered.
After: Once you’ve paid the gross premium in the Schedule, you’re covered.
Before: We refer to your Group Salary Continuance (GSC) Plan claim. We wish to advise you of the following important information that relates to you. We note, as per the policy document, that your claim has been finalised. Please take this as your claim being finalised.
After: Congratulations. We’ve finalised your Group Salary Continuance (GSC) Plan claim.
Before: Please take this communication as confirmation that we have received your request to cancel your policy and confirm that your policy has now been cancelled.
After: As requested, we’ve cancelled your policy.
Contracts that speak more plainly and are more accessible to customers help to build the all-important sense of trust.
Speaking with elegance may not be within everyone’s power, but simplicity and straightforwardness are. This is why brands should try to write as people speak — that is, in a plain, straightforward way. In plain English.
So, don’t miss this valuable opportunity. As Thomas Edison once said: “Opportunity is missed by most people because it is dressed in overalls and looks like work”.
This article originally appeared as a longer essay in the prestigious Clarity Journal, the international journal promoting plain legal language entitled Beyond all reasonable doubt: the brand advantages of plain English contracts. It was also published in Lawyers Weekly.