Blockchain will be a catalyst for innovation
Blockchain has the potential to be a catalyst for innovation in many industries, including the re/insurance industry, and taking advantage of new technology is exactly what re/insurers need to do, according to Giacomo Ganz, client manager of the Americas at Allianz SE.
Ganz will be presenting “Blockchain: The next revolution after internet?” in a panel session on Monday, November 13 at 2pm, during the FIDES conference.
“A potential reduction of 30% on internal administration expenses merits a serious consideration. Reduced attritional costs could also enable new innovative products to be placed on the market and even contribute to fill the insurance gap in various countries,” he explained.
And it’s essential that re/insurers begin taking advantage of new developments such as blockchain, a distributed ledger technology.
“Millennials will constitute half of the global workforce by the end of the decade. They have high expectations for technology-based services and will define how products are delivered,” advised Ganz.
According to the Allianz Re executive, studies have suggested that a desire to become more consumer-centric and enhance personalised services is shared throughout the industry.
He added that although some are early adopters, and others followers, one can clearly detect a move towards using more technology.
This includes artificial intelligence and machine learning in the field of telephone fraud detection when reporting claims, the use of satellite imagery to speed up property indemnifications after a storm, and connected cars and new products based on blockchain technology.
Ganz went on: “The fact that there is an official blockchain insurance industry initiative—B3i—shows there is a big interest in distributed ledger technology in the insurance and reinsurance industry.”
He noted that there are numerous improvements to be made in the insurance sector, although none of these changes will occur overnight and without “meticulous research”.
Some of the potential use cases for blockchain technology currently centre on increasing transparency, reducing fees, and providing cross-border solutions.
“It is evident that B3i will continue to grow and attract new members for the foreseeable future,” Ganz said, adding that actively pursuing partnerships through this blockchain consortium will help create global industry standards and best practices.
Turning to regulatory understanding, Oliver Volk, a blockchain expert and B3i representative at Allianz Re, noted that the authorities are monitoring the development and use of distributed ledger technology “very intensively” and have a good understanding of the technology.
“Allianz is in regular contact with regulators to give updates about the development and use cases of distributed ledger technology as well as B3i. The regulators themselves also investigate internally about blockchain,” Volk added.
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