Insurers Uniting Towards Blockchain

Potential uses of blockchain have been debated in the insurance industry; product launches have been few. However there is hope: PwC predicts a 5 to 10 billion US dollars cost saving opportunity in a recent report and insurers are banding together.

B3i Initiative

Back in October Aegon, Allianz, Munich Re, Swiss Re and Zurich have launched the Blockchain Insurance Industry Initiative B3i aiming to explore the potential of distributed ledger technologies to better serve their clients.

Potential benefits of blockchain in insurance

Blockchain can also establish trusted relationships among all participants, providing a consistent, automatic contract execution environment where transactions and contracts are stored on a shared ledger, reducing significantly the administrative burden.

Challenges

Moreover, proof of concept applications will be critical to prove the potential within the insurance and reinsurance environment and look at how it could be applied in practice. Blockchain applications, like any viable business venture, need to provide adequate solutions to specific problems.

Last but not least: the ever changing regulatory environment including Solvency II regulation and the Insurance Distribution Directive (IDD) in Europe could be an uphill battle.

There are challenges ahead for insurers working towards Blockchain, however the potential benefits may justify the pains down the road.

This article was originally published on financialit.net.

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