Swiss Re together with a group of Europe’s biggest insurers have joined forces in an attempt to put Blockchain through its paces to evaluate whether the technology can help make the insurance industry more efficient.
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 clients through faster, more convenient and secure services. If Blockchain technology proves viable, it could well streamline paper work and reconciliations for reinsurance and insurance contracts and accelerate information and money flows, while greatly improving auditability.
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.
The Blockchain 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. Therefore Aegon, Allianz, Munich Re, Swiss Re and Zurich have 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. With this feasibility study, the founding members aim to 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.
Jason Richards, Head P&C Business Management, said: “Technology is already disrupting the wider financial services world and is now starting to make its mark on insurance. We want to be at the heart of these developments and see Blockchain as one of those potential catalysts for change. By actively creating partnerships and making strategic investments we can build smarter solutions together with our clients.”
The Blockchain Insurance Industry Initiative B3i will allow insurers and reinsurers to get a better insight into the applicability of the Blockchain technology in the insurance market. In addition, B3i 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. Such future development of a modern and efficient handling of insurance transactions will require common standards and procedures. Consequently, the Blockchain Insurance Industry Initiative B3i 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.