How blockchain technology renovates the Insurance Sectors ?
Each and every technology brings a new change over in any kind of businesses or industries . When we look at the list of industries that are disturped due to implementation of technologies , Insurance Industry stands first in the list . There may be many technologies that transforms the insurance industry , but Blockchain Technology proves to make notable transformation in Insurance Industry .
Here let us look over the transformation of Insurance industry by Blockchain and how blockchain is helping insurance industry to face the challenges.
Insurance and Types
Insurance is nothing but a protection from uncertain financial losses . To hedge against the risk of uncertain losses , a form of risk management is practiced which is known as Insurance Policy . A firm or an individual who provides insurance is known as insurer/insurance company/insurance carrier/underwriter. A person/group who buys insurance is called as insured/policy holder.
There are many types of insurance , but basically an individual needs the following insuarnce like ,
1. Health Insurance - An insurance policy which ensures you to get cashless treatment / expense reimbursement, in case of health issues .
2 . Auto Insurance - An insurance purchased by automobile owners to mitigate costs associated with getting into an vehicle accident .
3 . Title Insurance - An insurance which protects insureds against claims for past occurrences.
4 . Life Insurance - An insurance in which the insurer promises to pay a beneficiary amount money on the death of policy holder.
Types of insurance is vast concept to coverup completly but we are sure that we have described about the major types of insurance. Now , let us have a look at the major challenges faced by insurance industries.
Challenges In Insurance Industry
The major challenges that insurance sectors faces in recent days are as follows :
1 . The limited growth in markets for insurance sectors .
2 . Involvement of fraudulent claims activities .
3 .Occurance of third party payments and transactions .
4 . Difficulties in handling vast amounts of data .
There are lot more challenges in insurance sectors and the above mentioned major challenges can be overcomed by Blockchain Technology .
Blockchain - A key to Escape out of these Challenges
Blockchain in insurance sector can help to kickout most of the issues in insurance sectors and make it work effectively. Now let us look how blockchain rescue insurance industry from fundamental issues like stability and trustlessness.
Blockchain in insurance can provide trust , stability and transparency of data which creates trustworthyness in insurance sectors among people.
As blockchain uses public ledger which can resist duplicate transactions by monitoring each transcations. With the decentralized digital system , blockchain can verify the authenication of customers, policies and transactions by maintaining historical records.It creates a complexity for hackers to steal data .
The personalized smart contracts in insurance industry replaces physical paper documents and activities by smart contracts that conncets real-time records. This easily initiate claims and payments with high accuracy which inturns reduces money and time.
Third - Party Transcation
Blockchain reduces the amount of third-party transactions , claims and administrative costs . Blockchain helps for automated verification of claims and payment details from third party. With the use of blockchain , all insurance companies can easily retrieve past claims and transactions that are recorded. This furnishes trust among insurer and policy holder .
Blockchain can store,manage and share large amount of data . The use of blockchain can store large amount of static data /records without central authority and the data can be viewed by all individuals connected in blockchain.This kind of streamlined records can make transactions more accurate and risk assessment.
Blockchain can provide accuracte reserve calculation details on currently processing contracts , in insurance companies. This will be so useful for P& C insurers who is need of information about how much money is available as they pay claims. Thus Blockchain prevents them from specific risks.
Lot more benefits of using blockchain in Insurance Sector
1. The process can be simplified with improved efficiency.
2 . Reduces turn around time for the process of claim .
3 . Provides an improved risk management .
4 . Increases the trust by providing high security for records.
5 . Less or no fraudalence activities occurance .
6 . Improves KYC Compliance ( Know-Your- Customers).
7 . Furnishes better claims and policy experiences .
Insurance Sectors that uses Blockchain
Now , let us have a look at some insurance companies that adopts the use of blockchain which makes them survive stronger .
1 . Kasko2Go - An automotive insurance company uses DLT ( Blockchain ) for eliminating most of the red tape that surrounds auto insurance.
2 . fidentiaX - Life insurance company using blockchain to streamline their insurance procedure.
3 . Etherisc - With combines use of blockchain and big data analytics, Etherisc helps to protect most common investments in the globe : plane tickets.
There are many other insurance firms which uses blockchain technology and BI for facing complexities and issues .
Everyone will expect for a more open and a transparent Insurance Sector . This can be made possible with the use of blockchain technology . This shows that Blockchain holds the key to the future of the Insurance Industry . Let us hope the transformation of all insurance companies as secured and fast working with the use of blockchain technology.
How Bitdeal can Support ?
Bitdeal - Best Blockchain Development Company works on blockchain development for all industries at affordable costs . We develop blockchain for any knid of insurance companies with unique features and functionalities . Our experts can dedicatedly develop and deploy you the best blockchain for your insurance firm on time .