Five of Europe’s biggest insurers have come together to determine how blockchain can be deployed to deliver faster, more convenient and secure services.
The parties, Aegon, Allianz, Munich Re, Swiss Re and Zurich have launched what they are calling B3i (which stands for the Blockchain Insurance Industry Initiative).
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They say that if the technology proves viable, it could well streamline paper work and reconciliations for (re-) insurance contracts and accelerate information and money flows, while greatly improving auditability.
A statement announcing the B31 initiative says, “Blockchain offers huge potential for enabling digital contracts and transactions amongst multiple parties to be executed in a secure, transparent and auditable way. By establishing trusted relationships among all participants, blockchain has the potential to provide a consistent, automatic contract execution environment where transactions and contracts are stored on a shared ledger, thus reducing the administrative workload of multiple stakeholders to ensure contract consistency and execution.”
However the five insurance giants argue that technology can only reach its full potential for stakeholders if implemented in a consistent and compatible way, based on minimum standards to exchange data and transactions via blockchain.
They have thus agreed to cooperate for a pilot project, using anonymised transaction information and anonymised quantitative data, in order to achieve a proof-of-concept for inter-group retrocessions by the use of the blockchain technology they said.
The feasibility study will explore whether blockchain technology can be used to develop standards and processes for industry-wide usage and to catalyse efficiency gains in the insurance industry.
According to Harald Rosenberger, Head of Innovation at Munich Re, “Blockchain technology shows most of its potential only if it’s applied in a network of peers. Therefore we see a huge benefit for the insurance industry in doing this together in the B3i. With B3i we are in the position to explore and shape the future use of blockchain and to set the necessary standards for a true digitalisation of insurance.”
B3i should allow insurers and reinsurers to get a better insight into the applicability of the technology in the insurance market. In addition, It offers a platform to exchange insights regarding blockchain and potentially other technologies, use case experiments and research information.
This initiative aims to facilitate the transition from individual company use cases to viable solutions across the entire insurance value chain, the parties say.
“Such future development of a modern and efficient handling of insurance transactions will require common standards and procedures,” according to the statement announcing the initiative.
“Consequently, the Blockchain Insurance Industry Initiative is open to other insurers and reinsurers. Its ultimate ambition is to assess how blockchain technology can be established as a viable tool for the insurance industry in general and for insurance clients in particular.”