Many agencies use a facsimile signature for certificates and evidences of insurance—a scanned image of a wet signature has replaced the old rubber stamp.

Q: “Is it acceptable to e-sign these documents rather than scanning an image of someone's actual signature? Do the same guidelines apply to a producer's signature on applications?

ACORD simply states that a signature is required in most states, but it does not address what constitutes a 'signature.'"

Response 1: “E-signature and an image of a wet signature both constitute a legal signature. As long as the signatures contain necessary components from a legal standpoint—security and authentication, proof of consent, auditability and secure retention of the document—they are legally bindable under the Uniform Electronic Transactions Act and the Electronic Signatures in Global and National Commerce Act (ESIGN). The same applies to a producer's signature, as long as they are an employed representative of the agency.

Currently, 47 states have adopted e-signature laws; all 50 are likely to adopt them by the end of 2017. There's no dispute that a legally electronically signed document is far more secure and has a superior audit trail than one with a wet signature.”

Response 2: “In my experience, most agencies have pulled the appropriate signatures into their agency management systems so that they automatically drop when completing a COI, evidence of property or binder. Using integrated documents from agency systems is efficient and enables employees to fax, email or print documents as necessary. Use of portals is also increasing throughout the industry, and that works much the same way.

Regarding a producer's signature on an app, it normally drops in—assuming the producer completes the app in the agency management system, as the Best Practice workflow suggests. If they’re using paper, the wet signature should already be there.

I hope the question does not imply that someone else is completing the application and then having the producer sign it—the producer of record should always complete the app they’re signing.

In general, though, using e-signature for applications which must be completed remotely has been common practice for quite a few years in many agencies, and works well.”

Response 3: “A signature is defined differently by different states, and requirements sometimes differ based on the type of document. It is my understanding that generally, an e-signature will work in this scenario. But I encourage you to check with your state.

One caveat is that the e-signature should match the person actually doing the work—which is especially important if the person doing the actual work does not possess the required licenses.”

Response 4: “In 2001, ESIGN confirmed that an e-signature constitutes a legal representation of an actual wet signature. A signature can be a scanned image or typed in a script font.

That said, questions may still arise regarding the validity of the e-signature and who actually signed the document. A digital signature process overcomes these questions and potential problems, and most e-signature vendors provide that through their platforms.

In sum, anything you do to electronically sign a COI is legal. Just like a wet signature, it can be challenged in court, but a digital signature process has generally held up as solid evidence of a signature.”

This question was originally submitted by an agent through the Big “I” Virtual University’s (VU) Ask an Expert Service. Answers to other coverage questions are available on the VU website. If you need help accessing the website, request login information.