It’s Time to Rethink How We Measure Consumer Understanding. Part 1: What is the problem?

What is Intellibility?

What is Intelligibility Vs Comprehension?

Why Comprehension Matters More Than Ever

Challenging How We Measure Comprehension

What is Intelligibility?

Intelligibility is the quality of information being clear, coherent, and easy for its intended audience to understand. In legal and regulatory contexts, it goes beyond simple linguistic clarity or readability; it means that the content can be understood in a real-world context, its relevance is apparent, and the reader can grasp the implications and consequences of the information. 

The CMA’s Guidance on Unfair Terms helps us to further define intelligibility: They state, to be compliant, “obligations and rights should be set out fully, and in a way that is not only comprehensible but puts the consumer into a position where he or she can understand their practical significance.”

An intelligible document enables its audience not only to understand the words but also to use that understanding to make informed, confident decisions. 

Importantly, in regulatory and legal settings, intelligibility goes far beyond readability.  As something can be readable with clear sentences and plain words, yet still fail to be truly understandable, let alone able to be applied.  Research has shown that readability scores are a poor predictor of actual comprehension.

Intelligibility demands more: the information must be both understandable and usable.

Readers need to comprehend the material in its proper context, recognise their rights and obligations, and be able to make informed, confident decisions based on that understanding.

What is Intelligibility Vs Comprehension? 

While comprehension refers specifically to the reader’s level of understanding, intelligibility is a property of the document itself which indicates how well it supports comprehension. In this way, a more intelligible document is inherently more likely to be comprehensible to its audience.

Why Comprehension Matters More Than Ever

Understanding how consumers interpret financial and legal documents is no longer a “nice to have” – it's an ethical and regulatory imperative. These documents include everything from credit card agreements to insurance policies, terms and conditions, and privacy notices. Often written in legalese or dense financial jargon, these texts place a heavy cognitive load on the reader.

If a consumer misunderstands their rights or obligations, the consequences can be dire: financial harm, legal exposure, or long-term disadvantage. Ensuring that the average person genuinely comprehends this information is therefore central to fostering transparency, trust, and informed decision-making in society.

Challenging How We Measure Comprehension

For years, regulators and institutions have tried to assess whether financial content is “understood” by consumers. Under initiatives like the FCA’s Consumer Duty, organisations are required to demonstrate that consumers receive good outcomes and genuinely understand the information provided.

However, past efforts to test understanding have stumbled on several fronts:

• Testing basic recall is not enough. Remembering a term doesn’t mean someone knows how to act on it.
• Issues with using scenario-based questions: Some people may answer correctly not because they understood the document, but because they already knew the topic. That’s especially true in areas like finance where some users respond to questions with prior experience.
• Contextual reasoning is rarely tested. Consumers often struggle not with what something says, but what it means for them.
• False positives are common. Consumers may get answers right based on prior knowledge rather than understanding a new document.
• Superficial signals mislead. Even documents certified by the Plain Language Campaign may still confuse vulnerable or less able readers.

Consider a credit card agreement that includes interest rate information. A consumer may recall the interest rate but fail to understand how it fluctuates based on late payments - a real-world application with real financial consequences. Current assessments offer no guarantee that this understanding has occurred.   

There is a big gap between how comprehension is currently tested and how information from that testing is then relied upon by firms to demonstrate compliance and good outcomes.  This highlights the need for a more practical, adaptable, and real-world-focused way to test and describe understanding.

This is where the Amplifi Multi-Level Comprehension Framework plays a crucial role.

It is a way to accurately and meaningfully assess comprehension, and to reach different levels, where the user can interpret implications, apply the information to real situations, and reflect on its consequences. For some communications, simply remembering and understanding may be enough. For others, the goal must be deeper and more reflective comprehension.  

To address this, we have developed our own method, the Amplifi Multi-Level Comprehension Framework, which we will unpack in the second article next week.