Financial jargon costing consumers

Widespread confusion over financial terms means millions of people may be taking out policies or products without completely understanding what they offer, according to new research from Aviva.

The findings show two in five (41%) UK adults – equivalent to 21 million people – have ignored information given to them by financial providers, such as pension or bank statements, because they don’t understand the terms used in them.

Of those, almost one in five (17%) say they have missed an important change to their policy while 13% – 2.7 million people – say they have actually lost money because they have ignored important communications.

To help combat the confusion caused by complex terms when taking out financial products such as pensions and insurance, Aviva has launched a ‘Jargon Buster Skill’ on Amazon’s Alexa voice service, giving users instant, voice-controlled access to a glossary of over 300 insurance terms and their definitions.

Alistair McQueen, head of savings and retirement at Aviva, commented, ‘The very essence of insurance is about reducing uncertainty and giving customers peace of mind, which is why it’s vitally important that as an industry, we help people get to grips with the language and principles of products that many rely on.

‘The Alexa Skill and the myth-busting guide are the latest in an ongoing series of improvements and transparency initiatives we are pursuing to help improve customers’ understanding of common financial terms and how everyday products work.’