Due to the ongoing pandemic, insurance companies have been under pressure to accelerate their digital transformation, prompting the development of new tools to improve automation, streamline processes and connect more effectively with insurance clients and brokers. In this article, we will discuss the advantages of using electronic signatures in the insurance sector.
Why is digital transformation necessary in the insurance sector?
According to data from Axis Corporate, digitally adapted companies will be able to increase their market share by up to 12% on average and, more importantly, increase customer satisfaction by up to 27%.
However, the digital transformation of insurances companies is currently facing several challenges:
- Significant investment is required.
- Correctly managing the transformation is essential since it involves a change in the insurance company’s corporate culture.
- Companies must adapt to the speed of innovations in the field of insurance, including apps for clients, interactive portals, custom insurance, etc.
What are the advantages of using the electronic signature in the insurance sector?
The insurance sector has been undergoing a digital transformation, with the electronic signature emerging as one of the new secure and convenient tools to improve insurance documentation. So, what specific advantages does the electronic signature offer the insurance sector? Let’s take a look:
- Legal security. The electronic signature’s legal validity is recognized in the eIDAS Regulation, and in Article 25, it is established that 1. An electronic signature shall not be denied legal effect and admissibility as evidence in legal proceedings solely on the grounds that it is in an electronic form or that it does not meet the requirements for qualified electronic signatures. Therefore, the electronic signature is entirely valid from a legal point of view.
- Control. The documents signed with an electronic signature are stored on the provider’s platform and the documentary evidence that contains all the electronic data of the signature process. Thus, insurance companies can consult the documents and download them when needed while having control over the entire process.
- Time savings. The electronic signature process in the insurance sector for both policies and other documents can take just a few minutes. Electronic signature results in substantial savings compared to the traditional process in which documents need to be printed, mailed to the insured, signed, and returned.
- Saving resources. The handwritten signature process also involves using numerous resources, including paper, toner, pens, mailing costs, and travel-related costs. In contrast, using the electronic signature in the insurance sector does not require using these resources.
- Improved customer satisfaction. The electronic signature in the insurance sector provides speed throughout the entire process of taking out the insurance policy, which translates into greater customer satisfaction. Consequently, the customer can become an ambassador of the brand, recommending it to others and potentially taking out other insurance policies with the same company.
- Sustainability. The savings of resources that occur with the electronic signature in the insurance sector enhance the company’s sustainability and corporate social responsibility.
- Savings in storage space. Traditionally, insurance policies were printed and stored in companies’ storage areas, requiring large spaces for storing documents. With the electronic signature application in the insurance sector, such storage space is no longer necessary since the documents are in the cloud and can be accessed when needed.
What type of insurance policies and documents can the electronic signature be applied to?
The electronic signature can be applied to any type of insurance, including vehicles, homes, health, travel, death, life, and civil liability. Furthermore, documents that can be signed with an electronic signature in the insurance sector include the following:
- Insurance policies
- Annexes to policies
- Claims reports
- Cancellation of policies
- Claims for non-payment
For a company’s internal processes:
- Employment contracts
- Sick leave reports
- Requests for holidays
- Internal communications
For non-client third parties:
- Contracts with suppliers
- Communications with banks
In summary, any document that needs to be signed by the company can be signed with an electronic signature. Furthermore, there are different types of electronic signatures with various technical complexity and security levels, including simple, advanced, and qualified signatures.