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Transparency and Readability of Consumer Information

Background

Last Updated: 10/24/2025
Issue: Insurance regulators recognize the difficulties consumers encounter when seeking personal lines insurance coverage and are researching whether consumers receive enough information to compare different insurance companies' personal lines policies.

Overview: Consumer advocates argue that not all homeowners' policies offer the same extent of coverage. Consumer advocates assert that homeowners insurance policies vary significantly in coverage quality and scope. They contend that consumers are unable to effectively evaluate policies as policy language is typically inaccessible until after they have purchased a policy. Additionally, brokers and agents often lack access to the full policy documents, limiting their ability to explain coverage differences to prospective buyers.

Opponents of public policy disclosure argue that most consumers do not read their insurance policies in full, limiting the value of making them widely available.. They also emphasize the complexity of homeowners insurance, noting that policy terms and coverage are influenced by state-specific regulations, which vary across jurisdictions. . Additionally, they contend that the ability of policyholders to request amendments or endorsements further complicates comparison shopping, as these individualized changes can significantly alter coverage.

Actions

Status: In 2010, the �Ӱ��Ƶ formed the Transparency and Readability of Consumer Information (C) Working Group to review the controversies surrounding transparency and readability.

The working group’s current charges include:

Assisting in the development of clear, effective language for consumer-facing documents
Evaluating disclosures related to premium increases for property and casualty insurance products
Maintaining and improving digital content for the Homeowners and Auto Insurance Shopping Tools
Identifying strategies to strengthen DOI communications with diverse populations, including rural communities

The working group has compiled multiple documents, which have been adopted by the Property and Casualty Insurance (C) Committee, and the Executive (EX) Committee and Plenary. They include the following:

Best Practices for Creating Online Policies: State insurance departments began to post insurance policies online, which required a combined effort between regulators and industry. The working group completed a best practices document for creating consumer online insurance policy resources. This document includes background information, department of insurance considerations, methods of data collection, identifying the scope of the project, document format considerations, web format considerations, additional information, maintenance, and sample forms.
Best Practices for the Design and Implementation of Web-based Consumer Premium Comparison Guides for Personal Auto and Homeowners Insurance (2013)
Flood Insurance Basics: The working group created a flood insurance basics document to help consumers understand the need for flood insurance and information on how to buy flood insurance, as well as some flood facts that can be used by departments of insurance in their social media campaigns regarding the importance of purchasing flood insurance.
Post-Disaster Consumer Claims Guide
Consumer Guides and Shopping Tools: The consumer shopping tools explain how to purchase homeowners insurance and personal auto insurance. Both shopping guides include questions for consumers to ask their agent before purchasing insurance, a list of possible discounts, as well as a tool that provides coverage summary information.