Blockchain Insurance use cases are poised to unlock an estimated $300B in value, largely from machine learning and artificial intelligence (AI) applications. Automated claims processing and fraud detection and prevention are two of the most popular implementations. However, secure access to data needs to be given to various third-party stakeholders for this value to be realized. This value could be transformative if companies can find a way to coordinate, cooperate and share data securely while complying with a growing list of government and industry regulations.
Insurance companies should view Blockchain as a cryptographically secure form of shared record-keeping capable of unlocking hundreds of billions of dollars in value. For example, some estimates indicate that securely sharing claims records between insurance companies could save the industry over $100B yearly in fraud prevention alone. Indeed, Blockchain has a promising future for the insurance industry across a variety of implementations.
Blockchain Insurance Use Cases
Enhanced Operational Efficiencies
Automated Claims Processing
Fraud Detection and Prevention
Regulatory Compliance (Data Privacy, Security)
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Blockchain and Insurance
Certainly, the insurance industry has been slow to react to these trends, but there is increased pressure from Insurtech innovators to adapt. Factors driving Blockchain adoption include:
- For various reasons, the insurance industry continues to rely heavily on manual processes. Some estimates indicate that manual processes double costs in some insurance sectors. Blockchain promises to enable automation of many time-consuming manual processes.
- Secure data sharing between insurance companies and other stakeholders could save the industry $300B a year in efficiency gains and fraud prevention alone.
- Transformative regulations are on the horizon that will force insurance companies to adapt. Blockchain will be a major factor in complying with these regulations. Some European regulations mandate sharing of information through a secure API. It is expected that similar US regulations are on the horizon.
Unlocking this tremendous value depends on digitizing legacy data and storing it in a secure system accessible by APIs. All new data must also be secure throughout the entire data processing chain. Through our Blockchain Consulting, Cloud App Developers, LLC offers creative solutions to real-world challenges within the insurance industry.
Blockchain Insurance Use Cases
Companies in Europe are being forced to comply with new government regulations requiring insurance data to be accessible to consumers (similar initiatives are on the horizon for US insurers). These consumers could be in the government or private sectors. Blockchain is a preferable solution, but devising a workable solution is not straightforward. Implementation is even more challenging because the requirements of each country in Europe can differ greatly, so the solution needs to be flexible and secure. Our solution is to implement an API and infrastructure, so the registered insurance providers, or delivery companies, can push events to a Blockchain cluster synchronized to all nodes. If the Blockchain remains intact, one can assure consumers data extracted from the Blockchain is consistent. We’ve conceived of an API that loads house insurance information in a general database that can be queried by appropriate parties on demand. (See Figure 1)
How this solution could work:
How this solution could work:
- An insurance event is initiated.
- Given events processed based on type and metadata. Necessary data is aggregated.
- Event information is encrypted (event can be registration of a new insurance policy).
- Encrypted data is loaded into the local Blockchain node.
- Synchronization initiated on rest of blockchain nodes.
- Data is decrypted and transferred, gathering insights as necessary.
- Event data stored in central database, ready to be used.
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Cloud App Developers offers Blockchain Consulting, and Blockchain Application Development across multiple industries.
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For other Blockchain use cases, or to learn about insurtech data analytics, please visit Cloud App Developers or contact wes@cloudappdevelopers.com