To successfully deliver e-signatures and e-delivery applications, insurers should begin by implementing them in a single process or product, according to a strategic analysis released by ACORD and developed by international law firm Locke Lord LLP.

"Over the past few years, interest and work around e-signatures and e-delivery increased dramatically,” said Marcia Berner, ACORD’s director of implementation services. “Agents and carriers came to us with a strong desire to implement them, but with major concerns about the right way to do both and to work with each other in the process. By talking with both groups, it became clear that both have common questions and concerns mostly based in making sure they are clear on the legal requirements and how to make sure they are met. With ACORD's unique role in the industry, we felt that this was an area in which we could help bring parties together, and it fits nicely into our 2020 initiative, an initiative that is looking towards increased implementation and the future of the industry," concluded Berner. 

Guidelines for e-Signature and e-Deliver” was created to serve as a guide for agencies, distributors and carriers that want to use or enable electronic signatures, but are not certain how to proceed. It includes a list of best practices, as well as specific recommendations for insurers and producers.

Implementers should begin with one process and product, the strategic analysis suggests. For example, e-mails should be sent with links to a secure site, and a bounce-back policy is essential. More specifically, insurers should "develop an efficient method to review and verify producers' requests for approval of their electronic signature or electronic delivery processes.”

More recommendations for insurers include:

1. Publish a set of requirements for producers who have or want their own electronic signature or delivery process so they select a product and process compatible with your company’s requirements.

2. Develop an efficient method to review and verify producers’ requests for approval of their electronic signature or electronic delivery processes, such as requiring independent third-party verification compliance.

3. Create a multi-disciplinary work group for the process design, including representatives from IT, operations, new business, policyholder services, claims, legal, compliance, privacy and security areas.

4. The work group should develop a common set of terms to facilitate clear communication.

5. Seek active input from producers.

6. Consider the need to amend the company’s current agreements or policies applicable to producers, so they are properly informed of and bound to follow the company’s e-contracting processes.

"The biggest issue is the lack of comfort with the legal requirements and the inability to establish a process or choose a technology,” Berner said. “While ACORD is not providing legal advice in any way, by commissioning Locke Lord, a firm that has much experience in this space, we feel we can help support the industry and our membership."

By promoting an understanding of the legal requirements for electronic signatures and document delivery, ACORD intends the strategic analysis to serve as a foundational document for insurers and producers. It contains definitions of commonly used terms and includes overviews of both ESIGN and UETA, special considerations for using voice signatures, record retention and admissibility of evidence in court. It builds upon and broadens previous works by the Insured Retirement Institute (IRI) and the Depository Trust & Clearing Corporation (DTCC) that focused more specifically on the annuities sector.

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