What You Need to Know
- Insurers say allowing remote notarization could make the online insurance sales process easier.
- National notarization bills had strong bipartisan support in the last Congress.
- A real estate services firm says the federal bills would increase the level of competition independent real estate agents face from out-of-state entities.
A team of state insurance legislators wants to help people prove their signatures and documents are real without making in-person visits to notaries.
The lawmakers, members of the National Council of Insurance Legislators (NCOIL), are working on a draft of a Remote Notarization Model Act.
NCOIL included the draft model in a packet of materials for the group’s upcoming spring meeting in Charleston, South Carolina. NCOIL’s Financial Services and Multi-Lines Issues Committee plans to discuss the draft during a meeting session scheduled for April 17.
U.S. insurers often require a policyholder to use a notary public to verify the policyholder’s identify and verify whether that individual has signed a record.
Traditionally, most states have required individuals to get most or all notarizations done in person.
In recent years, the rise of the internet has increased interest in remote notarization services.
Virginia has been electronically notarized documents, in conjunction with the use of videoconferencing systems, since 2012. Since then, other states have adopted permanent remote notarization laws or regulations.
More states have put temporary rules in place since the COVID-19 pandemic started. But some lack permanent remote notarization measures, and the rules that are in effect vary widely from state to state, according to PropLogix, a company that helps real estate sellers with online notarizations.
As of Feb. 18, for example, California, Delaware and North Carolina had no permanent remote online notarization laws, according to PropLogix.
The National Notary Association offers an extensive library of information about state notarization laws.
Insurers and Online Notarization
Frank O’Brien, a vice president with the American Property Casualty Insurance Association, talked about remote notarization at an NCOIL Financial Services and Multi-Lines Issues Committee session in December.
O’Brien told committee members that state legislators should consider eliminating some notarization requirements, support use of online notarization services when notarization is necessary, and make states’ rules for any notarization requirements that still exist more similar, according to an NCOIL session summary.