Straight-Through Processing Among Key Benefits of e-Signature Adoption

Michael Laurie is vice president and co-founder of Silanis Technology.

The insurance industry is in the midst of a shift from paper to all-electronic processes. To keep the electronic chain intact, carriers and agents are incorporating electronic signatures, particularly for new business processing. This comes in part from the evolving expectations of the modern customer, with demands for an experience that replaces faxes, printers and courier packages with a simple and secure way to complete paperwork and signatures on a PC, smart phone or tablet.

Electronic signatures offer more than increased customer experience and satisfaction—the insurance industry is embracing this technology whether for auto and home, personal and commercial lines, or life and annuities as a foundational technology for straight-through processing (STP).

In a recent Life Brokerage Technology Committee survey, brokers ranked e-signatures as the technology initiative that would have the greatest impact on their business. Carriers that offer e-signatures also improve the business experience with agents, whether captive or independent. Transactions can be completed quickly, at the point the customer is ready to make a decision, reducing the shop-around syndrome and high drop off rates.

E-signatures also offer carriers unprecedented visibility and control over the channel. For the agent, having an automated method for capturing signatures (either face-to-face or remote) helps improve productivity and shortens the time to commission payout. And both parties reduce the risks related to disputes over “I wasn't shown that disclosure,” or “I didn't opt out of that coverage.”

While all parties benefit, there is the conundrum as to who should take the lead with e-signature technology – the carrier or the agent? This uncertainty has unnecessarily introduced confusion and slowed adoption within the industry, specifically in the independent agent channel. Many insurance companies do not want to wait for agents to adopt e-signatures on their own and are beginning to take steps to address the issue.

Based on interactions with the independent agent channel, the following insights will help carriers improve electronic signature adoption with agents and brokers.

Setting the Stage

The Electronic Signatures in Global and National Commerce Act (ESIGN) was signed into law more than a decade ago. However, it's only been over the past few years that so many e-signature workgroups have been formed by industry associations, including ACORD, LIDMA, IRI and LBTC. Without a clear policy in place, insurance companies risk finding themselves caught up in e-signature processes that may fail compliance regulations and lack iron-clad audit trails with data securely embedded in the document.

To eliminate roadblocks and hesitation over who is responsible for providing e-signature solutions, carriers need to make it easier for agents to do business with them and their customers. This may include issuing guidelines or maintaining lists of approved electronic signature vendors for agents to use to incorporate electronic signatures into their workflow. It is this development of clear policies that the industry needs to help propel adoption by independent agents.

It is important to note here that ESIGN is a technology-neutral law that provides limited guidance around the actual implementation of e-signatures. When developing a policy around acceptable e-signatures, carriers need to ensure that all approved options include a proven method of capturing electronic evidence, securing the entire transac­tion from beginning to end and providing control through workflow rules. Should there ever be a customer dispute, carriers will need the necessary audit trail of the transaction to demonstrate what took place when in a court of law.

Directing the Scene

Often, the agent wants to make his or her own technology decisions. They are reluctant to agree to each carrier's process because it requires multiple learning curves and processes. In addition, carriers' e-signature implementations sometimes lack the ability to reconcile with agency-specific forms and marketing material. This results in resistance.

Agents want to own the customer relationship and some carrier implementations do not enable the agent to personalize correspon­dence. For example, if customers don't recognize notification email as coming from the person they have built a relationship with, trust in the electronic process is compromised and may be abandoned for a slow, inefficient paper process.

With the right carrier-portal implementation, agent pushback is minimized. For example, a carrier-built e-signature workflow can allow the agent, agency or others in the distribution chain to:

• Trigger the email notification inviting the customer to the signing ceremony for both remote and in-person signing with the customer.
• Insert personalized contact information on the e-sign web screens to increase familiarity and make it easy for customers to follow up with questions or issues.
• Access a dashboard to monitor and manage e-signature transactions in real-time, including the ability to remotely guide a signer through the e-signature process step by step, if necessary.

Offering an electronic signature solution to agents that meets these needs is a competitive dif­ferentiator for a carrier. An electronic signature solution that is designed to meet the real needs of the agent community demonstrates commitment and willingness to build a lasting relationship that flourishes for both carrier and agent. The ability to personalize data on forms and send updates, links and correspondence through the agent's email promotes the carrier as a preferred partner.

Getting the Thumbs Up

Despite all the benefits of e-signatures, some carriers may ask, “If we build it, will they come?” Past attempts at deploying electronic signatures and e-apps to agents have had only modest success.  Fortunately, this is changing for many reasons, including the pervasiveness of mobile devices in our society. People no longer need their arms twisted to adapt; today they demand it.

Gone are the traditional barriers to adoption among independent agents; there is no investment necessary in dedicated signature capture pads. Today anyone can legally click-to-sign using nothing more than a web browser. If an agent wants a hand-scripted signature it can be captured directly on a mobile tablet such as an iPad.

Service providers, primarily agency management systems, policy administration, exam companies, and multicarrier e-application vendors recognize that you can't have e-apps without e-signatures and now routinely offer e-signature capability as part of their solutions. This integrated approach is arguably the ideal middle ground for both carriers and agents.

From a workflow perspective, it makes sense for electronic signatures to be built into the new business applications used by agents on a daily basis. This approach clearly helps mediate the concern over agents having to learn and carriers having to support multiple e-signature methods. Carriers can still give agents the ability to choose a solution, while limiting integration and due diligence efforts.

However, the need to ensure a secure and reliable process remains important here. In the past, many service providers that offered electronic signatures minimized the complexity of the e-signature requirements and simply built in basic capability themselves. Today, service providers have moved away from a simple consent checkbox and are partnering with true e-signature vendors.

As a carrier, it is important to understand the role you play in making e-signature adoption a reality. A clear strategy minimizes delay and opens the opportunity for increased revenue, improved customer loyalty, and lowered operating costs.