Agent Signatures required on policies?

[Gene Foraker]

Like Ray said, signing policies is really only optional.    Can you imagine that any State Department of Insurance would allow a company to not pay a claim for a properly bargained for and bound insurance policy just because the agent did not sign it?   If the policy were lost, the claim would still be paid.   A policy signature is only there due to tradition.   Even if State law says that a policy shall be signed, there would be no penalty for not signing as long as a valid agent was listed on the policy.



ORIGINAL POST BY CRYSTAL --- Topic split for the agent signature portion.....

I have searched ASCNet forums and here and I am not finding the answers I want, so if I have missed the answers somewhere out there, I apologize for my duplication!

We do commercial lines only. We have already been emailing documents such as invoices, audits, and endorsements, but we are looking to start emailing policies to clients as well. I have a few questions below for anyone who is already doing this. We are on Vision, but hopefully most of these questions can be answered in such a way that they can apply to any of the systems. Thanks in advance!

1. Do you regularly email policies to clients? Do you find more clients prefer this method as of late versus mailing paper copies?
2. Do you receive most of your policies by email from the carrier or do you still receive paper copies from the carriers?
3. How do you 'sign' the policies? (We use customized stamps in Adobe with the Producers signatures. But some carriers 'protect' their PDF documents, such as Travelers, which will present a problem for electronically signing them.)
4. If you receive a paper copy of the policy, do you prefer the Account Assistant to scan that copy & send to the client, or do you prefer they go to the carrier's website to download a clean version to send?
5. Do you have many clients that are unable to receive the policies by email because the files are too big? Do you use a third party to host the documents so that the client can download the policy from a link?
6. Do you have your client sign a form acknowledging that they would prefer to receive documents electronically?
7. Do you attach the email as well as the individual policy file in Vision/TAM/Epic, or just the policy (updating the activity that you emailed it)?
8. What does your overall workflow look like for processing a policy electronically?

Any other information you want to throw in there is very much welcomed!

[Mark]

Good point, Gene.  I was wondering about that myself because I've never heard anyone ever mention signing a policy.  I have seen where it should be signed, though so it did leave the question open for me.

[Jeff Zylstra]

The signing of policies has lost a lot of its importance over the years.   In the 80's, it was still required in Michigan, but I haven't heard anything about it in years now.   It used to be that a resident agent in Michigan had to sign a Michigan policy if the writing agent wasn't a resident agent.  Then there was the whole thing of signing fees, etc...  Haven't heard much about that recently either.  In some southern states, however, I get the impression that there is more of a "protectionist" feeling toward out of state agents. 

[Sherry Burrell]

The last countersignature laws were struck down in 2005 (and S Dakota was the last one - as far as southern states - it is South Dakota ).  Florida Nevada and Michigan were the ones we ran across the most - wanting more money for the resident agent to "sign" the policy.  Some states allowed the countersigning agent to collect 50% of the commission!

[Jeff Zylstra]

The last countersignature laws were struck down in 2005 (and S Dakota was the last one - as far as southern states - it is South Dakota ).  Florida Nevada and Michigan were the ones we ran across the most - wanting more money for the resident agent to "sign" the policy.  Some states allowed the countersigning agent to collect 50% of the commission!

I was speaking of Florida when I mentioned the "Southern" states.  And yes, 50% was a very common commission for countersigning a policy.  I was told that the only reason that was done was because other states required it, and that Michigan was reciprocal in that regard.  Kind of sounded "tit for tat" to me, but that's the way the game was played back then.

[brinkerdana]

After being the "licensing girl" in several agencies, I miss the days of countersignatures!

[Jim Jensen]

The last countersignature laws were struck down in 2005 (and S Dakota was the last one - as far as southern states - it is South Dakota ).  Florida Nevada and Michigan were the ones we ran across the most - wanting more money for the resident agent to "sign" the policy.  Some states allowed the countersigning agent to collect 50% of the commission!

I was speaking of Florida when I mentioned the "Southern" states.  And yes, 50% was a very common commission for countersigning a policy.  I was told that the only reason that was done was because other states required it, and that Michigan was reciprocal in that regard.  Kind of sounded "tit for tat" to me, but that's the way the game was played back then.

Of course Florida was one of the last. It's not people from the South buy vacation property in the north and have a hard time finding coverage for it. Florida agents could charge for the signature because it was such a pain just to issue a FL policy as a non-resident agent.

[Sherry Burrell]

Several states are a pain as far as non-resident licensing - hopefully this NARAB II bill passes and will solve some of that. 

[DebAmstutz]

Just yesterday at our chapter meeting, Steve Booth was talking about a company underwriter who stated an original "wet" signature was required on either an application or certificate (I don't know exactly which item, as I was in and out of the room working on lunch) and Steve talked about how he tried to convince the person that his signature in TAM was acceptable as an original signature.  He finally got to someone high up enough in the company who admitted the TAM signature was fine.  It would be a good thing if the companies pass on this information to their underwriters!

[Sherry Burrell]

We occasionally run into this with E&S brokers or bond u/w who want originals of applications. 

[Jeff Zylstra]

We occasionally run into this with E&S brokers or bond u/w who want originals of applications.

I know our electronic signature law was signed by President Clinton in 2000, I think.  I don't believe that it is "legal" to require a paper signature anymore in this country.   My guess is that many E&S brokers are used to working with London or overseas markets that may still require "real" paper and signatures, although I think the EU and GB have similar laws as well.

http://www.forbes.com/2000/06/30/mu8.html

[Billy Welsh]

As I read this, the act simply made it acceptable and legally binding, but did not mandate that electronic sigs be allowed in place of original sigs.

So, states, surety companies, and the US Army Corps of Engineers can still require original "wet" signatures. 

[Jeff Zylstra]

As I read this, the act simply made it acceptable and legally binding, but did not mandate that electronic sigs be allowed in place of original sigs.

So, states, surety companies, and the US Army Corps of Engineers can still require original "wet" signatures. 

In reading the actual law, I think that you are right.  Apparently it's just a matter of people who still need the security blanket of their "files" and their paper apps and signatures.