Product Code: VF0087IA
Blockchain is a distributed ledger that is broadly discussed as a technology with huge innovation potential in all areas of financial services. To date, it is largely in the banking arena where blockchain use cases have been identified. However, blockchain technology also offers potential use cases for insurers, including innovating insurance products and services for growth, increasing effectiveness in fraud detection and pricing, and reducing administrative costs. In these application areas insurers could address some of the main challenges they are facing today - such as limited growth in mature markets, and cost reduction and regulatory pressures. The implementation of blockchain is a long-term project as it largely depends on network/system effects as well as on defining the regulatory conditions. In addition, before initial implementation steps are taken the benefits and limitations of the technology need to be fully addressed and understood. Considering all of this, and with many other financial services investigating its prospects, now is the best time for the insurance sector as a whole to further explore blockchain technology and its potential.
- Blockchain ultimately provides access to secure, decentralized transactions, offering an improved basis for non-repudiation, governance, fraud prevention, financial and personal data, and reporting.
- Insurers see blockchain as an opportunity to integrate the ecosystems of trusted third parties to reduce the costs of their global platforms, improve customer and market reach, and develop new propositions.
- Blockchain provides more scope for insurers to maximize governance through improved data access, third-party controls, and more sophisticated management of the risks associated with their products and services, including resilience services and cyber insurance.
Verdict Financial's "Blockchain: An Emerging Digital Platform for Insurers" provides an in-depth analysis of blockchain technology and its potential application to the insurance industry. The report discusses how blockchain could revolutionize many of the long-standing systems and processes within general insurance, and how insurers could benefit from the characteristics offered by the tech. The brief also provides an overview of the limitations of blockchain and the challenges insurers are likely to face going forward.
Reasons To Buy
- Gain a detailed insight into the functions of blockchain technology. Discover how blockchain could be applied to general insurance, including the potential benefits and limitations.
- Be informed of the insurers investing in the technology and looking to develop blockchain-centric propositions in the coming years.
Table of Contents
- Blockchain is both an opportunity and a threat to insurance
- Key findings
- Critical success factors
THE IMPLICATIONS OF BLOCKCHAIN FOR INSURERS AND THE INDUSTRY
- Introduction: what does blockchain technology mean for insurers?
- Blockchain is a tagging system designed to prove the time, integrity, and identity of data
- The evolution of blockchain is redefining certain aspects of the insurer business model
- The evolution of blockchain presents new technical dynamics for insurers
- Keyless signatures assist in the authentication and preservation of claims
- Blockchain could provide a means to manage claims in a transparent manner
- Insurers are looking beyond algorithms to establish a customer-focused claims model
OPPORTUNITIES FOR INSURERS
- There are three main areas of opportunity for insurers in the use of blockchain
- Fraud detection and risk prevention are the primary solutions for the industry
- Collaborating with payment systems developers would help expand market knowledge
- Blockchain technology offers a new level of cyber resilience
- Investments in digital tech are becoming more commonplace among insurers
- AXA is considering the integration of blockchain technology into its business practices
- Aviva has partnered with Plug and Play to help transform ideas into products
- Blockchain's potential presents the use case for innovative smart insurance contracts
THE OUTLOOK FOR BLOCKCHAIN AND THE NEXT STEPS FOR INSURERS
- There are limitations insurers must consider before applying blockchain
- Abbreviations and acronyms
- Primary and secondary research
- Further reading
- About Verdict Financial
List of Figures
- Figure 1: Blockchain was initially designed to facilitate the transfer of currencies
- Figure 2: A full audit trail of transactions in a blockchain makes transaction fraud difficult
- Figure 3: Keyless signatures are used to verify electronic data stored in the blockchain
- Figure 4: Some versions of blockchain technology offer insurers advanced cyber coverage