Blockchain technology will “dramatically change insurance transactions” but is often misunderstood, according to the chief risk officer at a firm which says it is the world’s first blockchain company.
The technology is about identity, data ownership and integrity, not cryptocurrencies, says David Piesse, CRO at Guardtime.
“It will get customers closer to insurers, reduce errors and omissions, streamline processes to reduce expenses, and improve claims management so insurers’ combined ratios improve,” he said of the emerging technology.
Search and compare insurance product listings against Data Breach from specialty market providers here
While there is a lot of hype about blockchain, its real purpose is data integrity and protecting the data layer, he explained, adding that it is a way to share data safely between multiple parties.
“Many data integrity breaches could have been prevented if blockchain were used,” said Piesse, who will lead a panel session on exponential technologies and deliver a keynote address on blockchain at the Asia Pacific Insurance Conference in Singapore next month.
“Organisations must look at their ‘crown jewels data’ and make sure it’s protected. Encryption without integrity is not enough,” he said.
Describing blockchain as “enterprise risk management for the digital world,” Piesse predicts that the technology will eventually become as ubiquitous as the internet. The timeframe will depend on countries’ regulatory systems, but it will help nations without strong insurance penetration to leapfrog into micro-insurance, according to the risk officer.
Guardtime, along with a range of partners including
EY and global shipping company Møller-Maersk, has developed a world-first marine insurance blockchain platform which launches early next year.
The blockchain platform connects clients, brokers, insurers and third parties to distributed common ledgers that capture data about identities, risk and exposures; and integrates the information with insurance contracts.
Related stories:
Suncorp discusses $100 million strategy
Deloitte partnership to boost insurance contract standard
