Many issues the Work Group addressed often are not contemplated during the busy-ness of day-to-day operations. It’s kind of like insurance: you don’t think about it until something happens, and then it’s the most important thing in your life. Failure of both carriers and agencies to make sure there’s clarity on technology issues up-front can lead to significant problems down the road—for them and their customers.
The ACT Work Group identified key overarching principles that govern agreement language and details. These include: addressing technology as an addendum to a broader agency agreement; establishing the agency agreement as the controlling document; handling data ownership and expirations in the main agency agreement and addressing retention and systems of control in the tech addendum; and ensuring that negligent parties bear responsibility for resolution.
The group also identified and offered guidance on ten specific issues that agreements should address:
· E-Signatures. Significant growth in the use e-signatures calls for clear understanding of procedures and policies, particularly around integration, characteristics of identity, consent, disclosure, and audit trail.
· Click-Through/Clickwrap Agreements. These on-screen license agreements typically are one-sided and “signed” only by parties against whom terms will be enforced. Recommendation to not use these for agreements between carrier and agency.
· Single Sign-On/Federated IDs. As vendors implement Single Sign-On and the industry moves toward ID Federation, agreements need to address access restrictions and administrative responsibilities of both parties.
· Data Breach. It’s important to spell out notification responsibilities and incorporate “hold harmless” and other language that addresses what happens for both parties—carriers and agents—when a data breach occurs. And we know one will!
· Prompt Correction of Data and System Errors. Either party must immediately notify the other when they find incorrect info in the system and the responsible party must make prompt corrections.
· Telematics. Carriers should provide agents and brokers with clear education, direction and access to available telematics-generated data and procedures to ensure responsive agency- and carrier-driven customer service.
· Agency Agreement Controlling Document. Significant inconsistency currently occurs from agreement to agreement. Recommendations offer guidance on form, timing issues, duties and an array of content-related topics.
· Access by Authorized Users. Carrier policy on website access and definitions of user and permitted use must be clear, as should processes for granting access and responsibilities for misappropriation or misuse of information.
· Use of Data by Third Parties. Use of third-party information and disclosure of customer information to third parties should be addressed, as should use of click-through and clickwrap agreements for customer access.
· Access to Data by Active & Terminated Agency. Agencies that terminate their agreements still need access to their data—including policy information and full activity logs. The recommendations set out considerations for this.
The Work Group created a six-page document, Summary Review of Agency Agreements for Technology Content, which reviews these critical and emerging issues. A section for each briefly discusses how agreements should address the topic and, more importantly, offers guidance for contractual improvement.
It is in the best interest of carriers, agencies and their business partners to understand the issues and to address them now, before a problem arises.