The best lead the industry. This is true whether operating in the healthcare sector, space industry, or the risk management field. Blockchain is a new technology finally generating the credit due to it through the unusually fast rise of Bitcoin in early 2018. Regardless of the merits of investing in Bitcoin, the technology promises to change fintech and insurtech.
The Rise of Insurtech
Thus far, most insurtech innovators have focused on using various apps to eliminate a few middlemen in the insurance process. For example, a car automatically reports a claim upon the occurrence of an accident resulting in an immediate payment of funds to the insured’s checking account without the filing of a claim. This idea certainly opens the door to lower premiums, but really depends on cars with technology not widely available. In other words, it is a good start but is not the killer app.
The Rise of Blockchain
Where blockchain really adds value is the possibility of creating new types of insurance in the future. Through distributed ledgers we eliminate the need for third party verification of transactions. Thus, there is no need for a bank. There is no need for claims reporting (assuming automation is possible). Further, if insureds decline full indemnification, pre-defined payments can open the door to new types of insurance never before offered in the markets.
These possibilities – the insurance of tomorrow – is where the insurtech entrepreneurs should spend their time. Much like the internet boom of the ’90s, we have not yet seen the full application of blockchain technology. Retail is already starting to change as new stores feature consumable items and no cashiers. So, too, shall insurance change over time.
Any new technology is exciting. Blockchain opens up opportunities never contemplated in the history of risk management. These innovations will change the insurance industry more than we can imagine.
Read Our Article on Captive International
Venture Captive Management is proud to have Chief Compliance Officer and General Counsel, Matthew Queen’s, article The Future of Insurance – Blockchain Captives published on Captive International’s website. Captive International is a leading source for the latest news, analysis, and features drawn from ongoing coverage of the global captive insurance market and bespoke special reports. If you would like more information about how VCM can help your business, please contact us directly. We’ll be happy to help you find and create the captive insurance structure that work best for your company