Dec Page Quarterly - Fall 2011 - (Page 8)

Legal Matters Electronic Delivery of Insurance Policies By Mark G. Burnette conduct the transaction by electronic means. Thus, if an insured has not consented to the delivery of an insurance policy by electronic means, such a delivery of the policy will not satisfy the requirements of O.C.G.A. Section 33-24-14. In addition, the State Act provides that if another statute requires the delivery of a document “by a specified method,” such a document must be delivered by the method specified, with one exception. That exception concerns the delivery of a document by “first-class mail, postage prepaid, or by regular United States mail.” Where either of those two methods of delivery are specifically required by another statute, electronic delivery of the document in question is possible by mutual agreement of the parties involved if the other statute permits the parties to agree to a different method of delivery. O.C.G.A. Section 33-24-14 does not address whether the parties involved may agree to another method of delivery of an insurance policy. However, given the stated purposes of the Federal and State Acts to facilitate the use of electronic transactions in commerce and the use of the phrase “or delivered” in that statute, good arguments can be made that under the State Act the electronic delivery of an insurance policy is permitted if the requirements of that Act are satisfied. Assuming that the State Act permits the electronic delivery of an insurance policy, the Federal Act imposes very specific requirements on such a delivery to a consumer (i.e., an individual obtaining products or services to be used primarily for personal, family, or household purposes), which requirements have been adopted by the State Act. A consumer must affirmatively consent to the electronic delivery of an insurance policy and must not have withdrawn such consent, after the consumer has been provided a “clear and conspicuous statement” containing the following information: 1. Any right or option of the consumer to have the record in question provided and made available on paper; 2. The right of the consumer to withdraw the consent to have the record provided or made available in electronic form and any conditions, consequences (which may include termination of the parties’ relationship), or fees that may be imposed in the event of such withdrawal; 3. A description of the procedures the consumer must follow to withdraw such consent and to update information needed to contact the consumer electronically; 4. A description of how the consumer, after consenting to the use of an electronic record, may obtain a paper copy of any such record and whether any fee will be charged for such a copy; 5. A statement about whether the consent applies only to the particular transaction in question or to identified categories of records that may be provided or made available during the course of the parties’ relationship; and 6. A description of the hardware and software requirements for access to and retention of the electronic record in question by the consumer. The Federal Act also requires that a consumer who has consented to the use of electronic records in a transaction must be informed (i) of any change in the hardware or software requirements necessary to W ith the increasing use of the Internet to conduct business and the desire of many businesses to go “paperless” for economic, ecological and other reasons, the question has arisen regarding the ability of an insurance company or agent to satisfy the requirements of O.C.G.A Section 33-24-14 by electronic means. That statute requires every insurance policy to “be mailed or delivered to the insured or to the person entitled to the policy within a reasonable period of time after its issuance.” The failure to do so can have significant consequences for the insurance company and its agent, if the agent assumed the duty of delivering the insurance policy to the insured. Whether the requirements of the above statute can be met by the electronic delivery of a copy of the insurance policy is governed by two statutes, the Electronic Signatures in Global and National Commerce Act passed by Congress in 2000 (the “Federal Act”) and the Uniform Electronic Transactions Act passed by the Georgia General Assembly in 2009 (the “State Act”). The Federal and State Acts validate all e-commerce, or Internetbased, transactions that satisfy their requirements, regardless of the existence of any inconsistent state law that may require a particular transaction to be evidenced by a written document or a manual signature. One of the requirements of the Federal and State Acts is that the parties to an electronic transaction (which includes the delivery of documents) must have consented to 8 INDEPENDENT INSURANCE AGENTS OF GEORGIA http://www.iiag.org

Table of Contents for the Digital Edition of Dec Page Quarterly - Fall 2011

President’s Message
Message from IIAG’s CEO
From the Department of Insurance
ON THE COVER
Legal Matters
13 2012 YAC Sales and Leadership Conference
Congressman Jack Kingston: A Lifetime of Leadership
IIAG Board of Directors 2011-2012
Calendar of Events
2011 IIAG Partners in Progress
Inside Back Cover Index of Advertisers/Advertiser.com

Dec Page Quarterly - Fall 2011

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