Sign of the Times
With the technology mature, insurers need to work to ensure distribution channel buy-in for e-signatures.
Insurance Networking News, 07/01/2010
Some insurance agents are embracing electronic signatures, while others remain skeptical. The receptive agents praise the efficiency of e-signing and fear a competitive disadvantage for agencies that fail to offer e-signatures to their tech-savvy clientele.
The reluctant agents hesitate to interfere with the traditional, handwritten signing ceremony or feel uneasy about putting a computer between themselves and their customers.
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Whatever agents think, analysts agree the future belongs to e-signatures. Within 10 years, nearly every John Hancock on every policy will be scrawled on an electronic pad, signed with a mouse click or verified with a few spoken or text-messaged words, says Steven Leigh, a principal analyst in Insurance Industry Advisory Services at Stamford, Conn.-based Gartner Inc.
Carriers are using e-signatures to cut costs, save time, trim staffs, discourage litigation, move a step closer to straight-through application processing and prevent customers from dropping out due to the tedious, snail-mail signing process, says Mary Ellen Power, VP of marketing at Silanis Technology Inc., a Montreal-based e-signature provider. That leaves carriers with the task of converting reluctant agents to e-signing.
"We're trying to create that desire in them to change and to keep current with the overall marketplace," says Wade Harrison, SVP of life/health operations for Bloomington, Ill.-based COUNTRY Financial. "It's certainly a change-management process that we've taken very, very seriously."
COUNTRY Financial agents, or financial representatives, as the company calls them, submit about 40% of eligible applications electronically with e-signatures, but the carrier hopes to reach nearly 100% early next year, Harrison says.
The carrier is winning over stragglers by sharing agents' upbeat anecdotes. "When they hear that their peers are having success, that makes them feel they can have success as well," he says.
PEER PERSUASION
To tell those e-signature success stories, agents who advocate the process were on duty in the life-and-health exhibit hall booth at COUNTRY's recent annual sales convention, Harrison says. Agents who embrace e-signatures also speak at other company gatherings and relate their tales on the carrier's Intranet site, he says. The company is considering a more formal mentoring effort, too, he adds.
Persuading agents to try the technology can win them over, Harrison says. "It's just a matter of trying to prompt them to do that first one," he says of e-signatures and e-applications. "The reps who are using it really like it."
Coaching and statistical reviews of the advantages of e-signatures are helping to win over hesitant call center representatives for Boston-based Liberty Mutual Group Inc., says Craig Dierkes, the carrier's director of call center operations.
In coaching sessions, Liberty shows each call center representative how much of his or her book of business was closed with e-signatures, and how many customers dropped out of the process, Dierkes says. Generally, agents achieve better retention rates with e-signatures because electronic applications spell out the steps needed to complete the documents, observers say.
"It's not about improving their e-sign results," Dierkes says of the coaching. "You view the benefits of increasing your e-sign percentage in terms of what impact it will have in improving customer satisfaction and improving your retention."
Liberty also tries to understand why some representatives favor paper documents by listening to their phone calls with customers and analyzing other data, Dierkes says. Knowing the representative's reason for choosing paper can help the carrier determine the best ways to coach them to choose electronic documents, he notes.
While carriers labor to bring some agents into the e-signature era, other agents are so eager to offer customers the e-sign option that they express frustration with what they view as the slowness of some carriers to integrate the technology into their IT systems.
"It's in its infancy when you compare it with what the consumer's going to be looking for from us," says Tom Minkler, president of Keene, N.H.-based Clark-Mortenson Agency Inc., and a member of the executive committee of the Alexandria, Va.-based Independent Insurance Agents and Brokers of America.
"We're going to lose opportunities for new business because a certain segment of consumers out there will get turned off if they don't have the ability to transact business in that type of efficient manner," Minkler says of e-signatures. "We can't just sit back and say this isn't important to us."
Not many of the carriers Minkler represents offer e-signatures, and some of those who do provide them still require agencies to keep customers' handwritten signatures on file. "That defeats the whole purpose, and that's one more layer of burden for us," he says.
