by Jon-Paul Hale
What I have found is quite interesting. As insurers create ways and means of managing this, it appears some basic rules from our judicial system have been ignored.
It has also highlighted that the process some insurers currently use for their paper documents does not meet the requirements either.
Specifically, regarding that last point, the MOT, change of ownership, forms with some insurers don't manage to witness signatures as required by law.
What are the rules for witnessing paper documents?
* For a witnessed document to be valid, the witness must witness the signing at the exact same time as the signee is signing it.
* If the document is a Will or power of attorney, it must be witnessed by two people following the requirements above.
This raises some issues with MOTs, as I mentioned above, where the form only has one witness area provided. This also brings with it challenges when these processes are moved to digital systems.
* Rarely are change of ownership forms signed by both parties simultaneously with relationship splits.
* Also, with business assurance, these docs are rarely signed simultaneously, with directors and shareholders often in different places and having busy schedules.
The Ministry of Justice (MoJ) has provided guidelines on the above processes in a digital environment:
* There is a process for single witness documents as digital documents.
* For double witness documents, there is no process for digital documents; these must be paper-based.
What's the digital process for single-witness documents?
I've had this explained in a more simplified form than what follows from the MoJ.
The witness is the document originator. They are the ones to send the completed document for signing. This is so that there is a documented single direct path between the witness and the signer.
* The witness must have a visual connection to the signer when they sign the document. Mitigating the "who signed it?" Question of blind email validation.
* This digital visual connection must be recorded. (Time-stamped proof of the audit trail)
* Once the document has been signed, then the witness can sign off as the witness.
This must have a perfect audit trail.
* The audit trail must show the document from the witness to the signer,
* the signing must coincide with the video recording time of the signing, and the witness's signing must immediately follow the signing by the signee.
If you have more than one signatory who needs witnessing on the same document, you repeat the process, adding to the audit trail and the witness signing off multiple times at different times.
Yes, there is quite a bit to manage there, but at the same time, we have a way to manage the change of ownership digitally with witnessing what the adviser can do.
Here's the thing: If a client were to do this with a lawyer and send it to us for processing, it is technically allowed by the court as described above despite the insurer's protestations.
It meets the requirements, and a lawyer doing this will likely raise merry hell with a process the court has sanctioned but an insurer isn't accepting.
* Also, we'll get some lawyers not really knowing any different, and they should know better than conforming to the insurers' kickback and process despite having done it to court standards in the first place.
Again, this is one of those aspects where we don't know what we don't know, and no one challenges it.
True, the provisions of the electronic signature laws say it is up to the receiver to accept this process; at the same time, these are also the process provisions of an inked signature.
I've recently had a change of ownership for a client separating with AIA, and it's been a pain in the arse for all the usual reasons.
* It took so long that the dates were out of date
* The ID provided didn't include signatures
* AIA's signature-less process meant that they didn't have copies of signatures on file.
* The signatures didn't match the IDs because the driver's license one never matches.
With a digital process by video, I could have tidied this up in a few days (client appointment permitting) and covered all of the issues.
Instead, it was left to people unfamiliar with the process and requirements to stuff it up and make the whole experience painful successively.
* So painful that they likely have lost faith in the industry's ability to manage anything efficiently.
As technology surpasses providers' ability to adapt, things like this in the legal industry will become more problematic for us.
How is the average adviser expected to argue with a lawyer that their sanctioned electronic process is unacceptable to an insurer that is bound by the same laws and rules?
The cliche is adapt or die; we need to figure this out and move on this sooner rather than later.
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