Independent or dependent? Choosing the right e-signature for insurance agents

Times have changed, but the essence of an insurance agent's work stays the same. You pour endless hours into building relationships with your clients; you gain their trust; you show them how your services will benefit them into the unknown future. And that's just the preliminary work.

Once you finally close the deal, a sea of paperwork can easily dampen this last, victorious leg. But time-consuming (and cost-heavy) pen-to-paper processes are no longer necessary thanks to digital documents and e-signatures.

E-signatures are the picture of customer and client convenience. They offer mobility, because they're ready when your customer is ready. E-signatures are logic-based and ensure good document order and accuracy. They move sales processes and other transactions along swiftly, and they can automatically notify who needs to sign what documents next. Plus, once you take into account all of the costs associated with paper (such as printing, ink, toner, shipping, etc.) e-signatures save significant money.

But not all e-signatures are created equal. The digital makeup of the technology can profoundly impact the level of control, transparency, trust and longevity of an e-signature—factors that are all very important in the insurance industry. After all, you may be dealing with sensitive or financial client information, or you may ask clients to sign off on transactions that must be valid two or three decades into the future.

To best understand e-signatures' technical diversity, it's easiest to place them into two categories—those that are independent and those that are dependent.

Independent e-signatures

As the name implies, independent e-signatures distinguish themselves by their independence from a vendor. That is, an agent doesn't have to rely on his solution provider to prove the validity of a signed document. Independent e-signatures use digital signature technology to embed a signature's cryptographic information directly into a signed document. Any free PDF reader will visibly show that a signature is a valid one, and it provides a complete set of evidence from the first signature to the last. And since the evidence is permanently embedded, you will always have access to the legal evidence, with or without an Internet connection.

What's more, signatures that can truly be classified as "independent" are based on international, published standards, like those outlined by the International Organization for Standardization, to meet objectives, worldwide standards for encryption, PDFs and more.

Because evidence is permanent and signatures are always defensible, independent e-signatures provide a heightened level of ownership, longevity, trust and transparency for its users.

Dependent e-signatures

The other type of e-signature is a dependent e-signature. While it won't always be called "dependent," such an e-signature keeps close ties to its vendor. Instead of permanently embedding evidence into the document, it links the signature to the vendor's server. In the ultra-connected world we live in, this may be suitable for many e-signature users needing evidence for the immediate future only. But links break over time and Internet connections may not be available when you need them. If anything compromises the vendors' server, like a catastrophic event, or if ties with the vendor are severed, you could also risk losing all of your e-signature evidence.

Because there is a connection to the vendor, it's possible for providers to use proprietary technology to deploy their e-signatures, which aren't guaranteed to be independently defensible in court, because they're not published or based on public standards.

Choosing the right technology for you

Both independent and dependent e-signatures can be easy for agents and clients to use, and they'll both promote cost-effectiveness, so choosing the right e-signature service for you ought to be focused on how and why you're using e-signatures.

Here are some of the key questions agents should ask:

• Am I using e-signatures to facilitate high-risk or low-risk transactions?
• What are the industry-specific compliance needs for my e-signed transactions?
• Will I need to ensure legal defensibility into the foreseeable future?
• Could my e-signed documents ever be challenged in court?

For mission critical transactions and when legal assurance and industry compliance are a must, independent e-signatures will be right for you. If you're only using e-signatures for low-level, temporary transactions, a vendor dependent e-signature may be acceptable. However, understanding the critical differences between the two will ensure you have all facts before making a decision that could affect the long-term viability of your office's critical contracts.

Pem Guerry is the Executive Vice President at SIGNiX, an Independent E-Signature™ solutions provider that makes signing documents online safe, secure and legal for any business. SIGNiX offers an independently verifiable cloud-based digital signature solution, which combines workflow convenience with superior security. Learn more about what makes SIGNiX different at www.signix.com.