B3i blockchain: 30% efficiency gains
There is a real opportunity to improve reinsurance processes with the use of blockchain technology, which can deliver cost savings and efficiency gains of 30 percent by taking out unnecessary reconciliation, repetitive duplication of work and waiting times.
This is according to Paul Meeuson, head of finance and treasury services of Swiss Re, speaking alongside a number of executives who gathered to discuss to the potential of blockchain at a B3i market presentation at the Monte Carlo Rendez-Vous.
“Let’s take insurance processes we have proudly seen develop, keep them relevant, and wrap new technology around them,” said Meeuson.
B3i has a group of 15 insurers and reinsurers participating in its initiative, working on a joint distributed ledger for reinsurance transactions driven by blockchain technology.
Allianz Re CEO Amer Ahmed said there will be interest in blockchain for its ability to improve costs and efficiencies, and to improve data quality and the speed of information transfer.
A market beta-testing programme for the prototype is due to start in October, and B3i has invited all insurance industry participants to join. They will be expected to give feedback and request changes based on their experiences.
Meeuson added: “Over the past four months, a dedicated combined team drawn from B3i member firms has produced a working prototype covering the core functionalities required to enable a distributed smart contract management system for property cat excess of loss contracts.
“The deployment architecture is already close to a production-ready environment and the team is preparing for feature enhancements of the prototype and a first deployment into production in 2018.”
The B3i team has also developed an industry business case for the platform across the whole value chain. The consensus among the companies is that a productivity gain of up to 30 percent is achievable.
Dennis Kessler, CEO of SCOR, suggested blockchain will drastically change the way the industry operates, and may even reduce the protection gap by reducing the cost of insurance.
Kessler also noted that it will accelerate all transactions with full security and transparency, which is key in a time when cyber attacks are prevalent.
At the B3i event in Monte Carlo, the group publicly showcased the fully functional beta version of its blockchain solution.
The current 15 members of B3i are: Achmea, Aegon, Ageas, Allianz, Generali, Hannover Re, Liberty Mutual, Munich Re, RGA, SCOR, Sompo Japan Nipponkoa Insurance, Swiss Re, Tokio Marine Holdings, XL Catlin and Zurich Insurance Group.
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