Given the unprecedented times that we currently find ourselves in, we need to adapt the manner in which we conduct business in the insurance industry. With there being lots of talk about electronic signatures in the wake of the COVID-19 pandemic, the question on many business personnel’s minds, faced with limited resources, may be what can actually be accepted as sufficiently and legally ‘signed’ when it comes to proposal forms.
As a first point, signed proposal forms are essential for insurance business as it makes up the pre-contractual documents of an insurance policy. The proposal form is the insured’s offer and the insurer’s quote will either be a counter-offer or the acceptance to provide insurance cover to the insured. As such, it is important that ‘signed’ proposal forms are received from insureds. Some insured’s may be finding it difficult to physically sign proposal forms during this time as most may be working remotely. However, a handwritten signature is only required in very specific circumstances as required by law or if agreed between the parties, in other circumstances electronic signatures can be utilised. The Electronic Communication and Transactions Act 25 of 2002 (ECTA), allows us to accept electronic signatures as binding in the majority of situations we find ourselves, in everyday business. The ECTA states that an electronic signature is binding if:
- a method is used to identify the person and to indicate the person’s approval of the information communicated; and
- the method is reliable, appropriate and relevant in the circumstances.
Accordingly, if an insured is unable to apply a handwritten signature to a proposal form, reasonable alternatives could be:
- utilising a pdf application’s signature function and sign the proposal form – this can be done in Adobe, Nitro or the like; or
- typing his/her name in the signature fillable field of a proposal form (if this available).
In both the above instances, for increased contract certainty the email attaching the proposal form, which includes the insured’s email signature, should be kept for record purposes. This ensures that a suitable and trustworthy method has been used to identify, and indicate the acceptance by, the insured, of the information in the proposal form.
It must be kept in mind that if the parties have agreed during the contractual process to a specific manner in which documents need to be signed, then this should be followed in order to be legally binding. In addition, there are specific instances where the law does require handwritten signatures.
All of Camargue’s proposal forms have fillable fields, which means that they can be completed electronically by any pdf application and signed utilising any of the above two methods. All of our Products’ proposal forms are available on our website here.