The insurance industry relies heavily on the notion of trust among transacting parties. For example, when you go to buy car insurance you get asked for things like your zip code, name, age, daily mileage, and make & model of your car. Other than, maybe, the make & model of your car you can pretty much falsify other information about yourself for a better insurance quote. Underwriters trust that you are providing the correct information, which is one of the many risks in the underwriting business.
Enterprise blockchain platforms such as one from Oracle essentially enables trust-as-a-service in such interactions. Participants (insurer and insured) need to come together to do business, but they do not necessarily trust each other. Blockchain provides a scalable mechanism to securely and easily enable trust in such scenarios. There are 4 key properties of Blockchain that enable trust-as-a-service:
Blockchain can be a good solution for a number of insurance use cases such as:
Besides these use cases, blockchain has potential to eliminate intermediaries, improve transparency of records, eliminate manual paperwork, and error-prone processes, which together can deliver orders of magnitude improvement in operational efficiency for businesses. Of course, there are other types of insurance such as healthcare, reinsurance, catastrophic events insurance, property and casualty insurance, which would have some unique flavor of use cases but they would similarly benefit from blockchain to reduce risk and improve business efficiency.
There is no question that blockchain can, potentially, be a disruptive force in the insurance industry. It would have to overcome legal and regulatory barriers before we see mass adoption of blockchain among the industry participants.
If you are working on an interesting project related to the use of Blockchain for insurance industry feel free to get in touch by leaving a comment or contact us through social media or Oracle sales rep. We’d be glad to help you connect with our subject matter experts and with your industry peers who may be working on similar use cases with Oracle. For more information on Oracle Blockchain, please visit Oracle Blockchain home pages here, and here.