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Insurance

Why Blockchain for Insurance?

Insurers are looking for a variety of processes from transactions.
Overall, blockchain offers the following transformational opportunities for insurance carriers:
 

  • Explore the viability of distributed ledger technology to automate claims and better serve clients through faster, more convenient and secure services
  • Improve data accuracy and consistency by enabling an environment where shared data cannot be deleted or changed without the consent of other parties
  • Encrypt and channel information with improved data security to create trust between parties and ensure they only access and view what they should

How Blockchain Works in Insurance: An Example From Healthcare

The blockchain can connect any number of entities on a single, shared, immutable ledger, replacing disparate systems and improving security, traceability and efficiency.

Use Case 1: Logistics Insurance

Now

Carriers insure goods that must travel through a complex chain of logistics providers and warehouses to get from point A to B, and there is often no unified view for consumers and merchants to track their orders. When a package gets lost, submitting an insurance claim is time-consuming, and payments take time to process, delaying re-ordering.

With Blockchain

Customers, merchants and carriers can easily track insured goods with a blockchain-based experience layer that provides a central source of truth and shows how goods travel through a chain of logistics providers and warehouses. In the event of lost or damaged goods, involved parties can easily determine where the supply chain is broken and who is liable for a potential insurance claim.

Use Case 2: Early Identification of Risk and Claims

Now

The FNOL (first notice of loss) process involves multiple communication channels and many manual steps to identify, gather and submit information and paperwork. Due to the large number of claims and their associated complexities, the manual processes of FNOL doesn't allow the digitization of risk modeling for actuaries and underwriting, nor does it provide efficient means of FNOL to claim representatives.

With Blockchain

Using a blockchain-based platform provides sense and awareness of potential claims by allowing the digitization of risk modeling for actuaries and underwriting, as well as efficient means of FNOL to claim representatives.

Use Case 3: Reinsurance/Billing

Now

The transmission and reconciliation of funds internally between lines of business or to the reinsurer marker is still a largely paper-based, manual process that requires parties to physically cut checks and deposit funds. Premium reconciliation and audits take large amounts of time, effort and cost.

With Blockchain

Blockchain provides the ability for automation validity with authoritative means and the transfer of funds internally and externally with insurers. This new framework allows for real-time tracking, secure transmission and reduces audit time for third parties.

Use Case 4: Travel Insurance

Now

Travel insurance claims require a significant amount of time to collect the authoritative documentation from multiple parties to prove the claim is necessary. If denied, the insurer must repeat the manual process. As a result, turnaround time for claims validity and pay-outs is much longer.

With Blockchain

A blockchain-based solution for travel insurance claims digitizes the process and eliminates paperwork, removing the validation and authentication steps as well as providing a true touchless claim workflow. Claims are submitted with or without the insured’s involvement, then processed and paid out immediately.

Have a Use Case Not Mentioned Above?

If the blockchain use case you had in mind isn’t listed here, please let us know and we’ll explore its potential for your enterprise with you!

Learn More about the Benefits of Blockchain in Insurance

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