When we talk about the sectors that can be revolutionized by blockchain technology, we obviously think first of all of the banking sector with the resounding example of Bitcoin cryptocurrency. What is less known, however, is that the second sector that is the subject of a technological disruption with the blockchain is that of insurance. Indeed, the very complex insurance sector, which requires the coordination of several actors, as well as the management of multiple data is a perfect use case for the blockchain. Let’s take a look at the scale of this insurance revolution!
A blockchain revolution identified by the players.
Studies are formal, blockchain is playing an important role in the insurance world, and it will continue to progress in this sector, according to a study by MarketsandMarkets, the growth potential of blockchain technology among insurers is 84 %. The blockchain insurance market could then be worth $ 1.4 billion by 2023.
Other studies by KPMG and Insurtech have revealed that blockchain technology is already being implemented by insurance companies. In particular to reduce the costs of their processes, bring more transparency between the different actors and increase data security. Concrete use cases in which the blockchain is already implemented are, for example, flight delay cases and requests related to lost luggage. Other use cases that may soon be subject to blockchainized insurance are parcel shipments and more indirectly the medical sector.
Blockchain has multiple advantages for the insurance industry:
Verifying the authenticity of insurance claims is a big part of the job of insurers, those who still use offline databases or even administrative papers waste a lot of time and money in this process. The combination of blockchain technology with smart contracts automates these processes.
A successful example of the implementation of blockchain technology in the insurance sector is in the United States where an American insurance company has developed a blockchain to automate the processes related to vehicle loan requests.
Another example is the development of a Blockchain by IBM to allow insurance companies to automate their regulatory administrative processes with the various public administrations.
Insurance scams represent huge losses for insurers, a study estimated the only losses of American insurance companies at $ 60 billion each year!
Blockchain improves the interoperability of the databases necessary for the verification and authentication processes of requests. When the administrative documents where the current procedures can give way to errors or a lack of traceability, the blockchain comes to provide a solution by concentrating the data of the different actors, in a secure, transparent manner, all of which is traceable by the actors concerned.
The startup Blockclaim is currently developing a solution combining blockchain technology and AI to automate insurance claims. This significantly reduces costs associated with case management, fraud detection is also more efficient through the use of artificial intelligence.
Thus, the blockchain offers many promises to reduce the costs of insurance companies, this should also have a positive impact for consumers who will benefit from reimbursements and recourse to insurance in an automated way thanks to smart contracts. And proof that everything is already fast between blockchain and insurance: it is possible to include crypto-assets in its life insurance contract!
Guillaume has been passionate about Blockchain technologies and cryptocurrencies for 2 years now. He firmly believes in the massive adoption of these in the years to come. Eager for crisp news and always on the lookout for the latest trends in the cryptocurrency market, he enjoys sharing with you all their secrets!