Skip to content

Blockchain: Adding value in the insurance sector

Share on twitter
Share on linkedin
Share on email
Share on whatsapp
Blockchain

In our first blog post of the year, Insurtech Trends 2018, Blockchain was listed as one of the technologies to be continued in this year 2018. And if it is true that in the previous edition of Insurance Week, Blockchain was already pointed out as a technology that the insurance sector should bet on, in this 25th edition of Insurance Week its presence was much more remarkable. There was a lot of talk about it, in fact they were the most popular talks and among those that seemed to arouse the most interest to the attendees.

The incipient interest in the use of Blockchain in the business world, does not seem a mere interest of the attendees of the insurance week, the investment of emerging companies that bet on solutions based on Blockchain represent a 340% more than in 2017, according to Goldman Sachs Report.

We all know or have read some article in which they try to explain to us what the Blockchain is. In our own blog we find numerous articles that go into detail about this technology. Here I leave you some links:

Many times, we go in to read a Blockchain post looking for really "our case of use"I am writing this article to echo the most interesting use cases that have been brought to us in this edition of Insurance Week.

IMPROVED CUSTOMER EXPERIENCE AND LOYALTY

This use case bets on using a collaborative Blockchain, as a new way to store and distribute information. Using it to store customer data or digital identity in a unique and of course much more updated way.

What will this allow?

This will help to improve the customer experience when interacting with companies through their online channel, for example to request pricing for one of their products.

And how will it help improve the customer experience?

Betting on a solution of this type, the companies from their operative platforms will make use of the client's data stored in the collaborative Blockchain, avoiding asking the user for all his data over and over again. This automation of the client's documentation contribution will make the experience much easier and more agile, avoiding the abandonment of the user in the middle of the management.

What about legislation?

Legislation must always be taken into account in this type of solution, as the client must give his express consent. It should be noted that this solution is characterised by its transparency, as it deals with personal data provided by the insured themselves, who always retain the power to modify or delete the data from their so-called digital identity.

NEW PRODUCT MANAGEMENT

Talking about trends in the insurance sector, we have already talked about new types of products appearing on the market as a result of the new models of behaviour in today's society. Parametric insurance and microinsurance are an example of these new products. To see a more concrete example of one of these new products that have emerged in recent times, we look at travel delay or cancellation insurance.

And here, what can we use Blockchain for?

If the management of this product is based on the use of Smart contracts, it is possible to automate certain procedures without the need for intermediaries. Access to a database where flight information is shared will allow you to know exactly whether or not the trip has been cancelled or delayed. In case it has been cancelled, it will automatically compensate the insured party by reimbursing him/her for the value insured, otherwise the insurance will also be automatically cancelled.

And what does all this automation bring?

From the process management point of view, both the processes of compensation or payments derived from trip cancellations, and the processes of cancellation of contracts that are not of a compensatory nature, are expedited.

These processes, which are more efficient and speed up your management time, are processes that directly affect the customer, since he does not have to worry about contacting his insurance company to notify it of the cancellation of the trip. What we find is that not only do we improve the internal processes of the company, but we also improve our client's experience, avoiding the paperwork and waiting associated with subsequent compensation.

SPEEDS UP THE PROCESSING OF CLAIMS

The use of Blockchain technology will reduce the costs associated with the management of claims by eliminating intermediaries between its clients and other companies and even third parties.

During one of the round tables held during this edition of the Insurance Week, the use of Blockchain technology in the insurance sector was discussed. Among the conclusions reached by the attendees, it was highlighted that Blockchain will allow for a reduction in the costs associated with the management of car claims, since it allows for the elimination of intermediaries between its clients and other companies and even third parties.


These examples that we have seen, help us to get down to earth some of the applications of Blockchain for which the insurance sector will be able to start betting. Although another thing that the speakers in the insurance week emphasized, is that this is a booming technology and that the regulators have not pronounced on it.

From Grant Thornton they point out that, although the regulatory body has not pronounced itself, they are betting on this technology with the support of legal professionals who examine the use of these technologies from the different points of view of the different regulations (GDPR, money laundering, etc...). And they emphasize that the problem will not be in the technology itself, but in its application or use during the design of each of the solutions.

Problems with legislation should not be linked to a technology itself, but to how it is applied in each of the solutions implemented on it. Blockchain should not be an exception in this respect.

Although it is difficult to know if Blockchain will be applied on a large scale in the insurance sector, if we can say that it is a technology that is being bet on a very relevant. During this edition of the insurance week it was highlighted that, although in 2014 and 2015 they had detected few teams in the sector working on Blockchain, in this year 2018, the number of qualified teams has multiplied exponentially.

Share the article

Share on twitter
Twitter
Share on linkedin
LinkedIn
Share on email
Email
Share on whatsapp
WhatsApp

A new generation of technological services and products for our customers