Reduce Risk and Errors with E-Signatures

Mary Ellen Power, January 20, 2014
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It may be hard to believe, but the majority of people lie every single day of their lives. Not in the sense that they are deliberately hiding the truth or deceiving others, but just in the simple way that they engage with the digital world.

If this seems like an unreasonable statement to make, then consider the fact that nearly every e-commerce transaction ends with the requirement for a user to tick a box stating that they have read and agreed to the terms and conditions of said purchase. Naturally, there may be those who read the entire iTunes agreement every time they install the latest software, but they are likely to be in the minority.

This tendency to skim over the terms and conditions of an agreement can leave businesses open to litigation should a customer ever claim they weren't shown those disclosures or didn't know to what they were agreeing.

For those involved in industries such as finance, insurance or real estate, reducing the potential for errors or omissions is one of the most important ways to reduce potential litigation.

Electronic Signature

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The digital footprint doesn't lie

Introducing electronic signatures into the document review and signing process virtually eliminates the ability for a customer to claim they didn't understand or didn't know what they were signing by painting a picture of evidence that proves what documents and screens were shown at what part of the signing process. Sure, customers can "lie" like they do with iTunes agreements, however with financial products like account openings, mortgage disclosures or insurance policies, it's in their best interest not to. The case law has shown time and again that a defense that claims to not have signed/understood the terms and conditions of an electronically signed document won't stand up in court.

Reducing 'not in good order' documents reduces risk

E-signatures have ensured that disclosures on products such as loans, mortgages or insurance policies now implement the same "required" fields that is are familiar to anybody who has purchased products online. Because of the workflow rules that e-signatures enforce, the consumer cannot claim to have not read the terms and conditions being presented for agreement. At the same time, this protects companies by reducing the risk of not-in-good-order documents as well as disputes as to what was signed.

For more information as to how e-signatures reduce errors and risk, download the whitepaper the Top 6 Legal Risks of Electronic Signatures and E-Transactions.