Shared economy insurance: The growing popularity of platforms based on sharing economy makes it imperative to provide real-time insurance coverage to the renters who book on this platform. The dynamic insurance, when offered through the Blockchain technology, can help real-time usage based insurance while maintaining the entire history of transactions. It will help in reducing the operational cost and maintaining the transaction history for future reference.
Subrogation in claims: While the current subrogation is highly manual in nature, insurers can leverage smart contracts to automate the processes of claim notifi- cation, loss investigation and recoveries from other insurers and reinsurers. This reduces the number of interactions between various parties, especially the call centers that spend considerable time on responding to queries of other insurance companies, claims intake, legal institutions and third parties.
Automatic claims settlement: The loss notification for an accident is trigged by the call center, smartphone app or connected car via the internet to the Blockchain and activates the smart contract. Once all the policy conditions coded into the smart contract are met, details are sent to the nearest workshop to prepare for parts replacement, the insurer is notified, and payment is triggered.
Reinsurance in insurance: This entails recording details of claims so that insurers and reinsurers can accurately share policy contracts, risk sharing and loss information costs between them. In this case,reassures reinsurers that the information provided existed at that point in time since the Blockchain provides an immutable record of claims and time-stamp when the claims are made.
IoT – Smart homes and connected devices: If accidents or problems are detected by sensors in the home / cars, devices can use Blockchain to trigger a set of instructions that automatically transfer cash for repairs from an insurer. Blockchain in IoT can solve the trust issues businesses face when building smart devices that can communicate and operate autonomously. Instead of having a human verify each change in the system, the Blockchain can verify each communication, transaction and change.
Group life insurance: Group life insurance policy involves employer as the owner of the policy with the employee as beneficiary. Therefore, all the changes are required to be routed through the employer to the insurer. Currently the process is highly manpower intensive and can be quickly automated in real-time by integrating the tri-party system through Smart Contract execution on Blockchain.
Workers’ compensation (WC): Insurers are facing huge number of claim frauds through workers’ compensation. Blockchain technology allows sharing of information between multiple parties. In this case, the health records and employment records, which are maintained digitally can be accessed by the insurer to decide on the actual loss suffered by the insured persons. This reduces the chances of fraud in WC and the claim settlement turn-around time.
Insurance proof of concept on Blockchain: Shared economy insurance
Wipro has developed a solution that shows how insurers can form a Blockchain-based consortium to enable property sharing platforms to provide ‘pay-per-use’ property insurance in the sharing economy. The solution showcases a peer-to-peer (P2P) based insurance scenario involving multiple parties in a shared economy network. It demonstrates the ability to mobilize, validate and manage a P2P insurance using a marketplace platform to reduce latency and enable instant entire quote-to-policy process through smart contracts. Data points from different source systems that represent changing risk factors are captured.