Blockchain will change how people look at data
Blockchain will lead to new risk assessment models and a new way of looking at data, according to Magdalena Ramada Sarasola, director, insurance consulting and technology, at Willis Towers Watson.
Sarasola, who was speaking at the Intelligent InsurTECH Europe 2018 conference in London, said that the risk capital journey has changed a great deal in the past 300 years, and that blockchain will have its own impact on it.
She pointed out that blockchain is about transacting value in a way that couldn’t be done 10 years ago, as the technology did not exist then. She said that blockchain empowers trustless, digital peer-to-peer networks that do not need a third party, and then asked what if the market could transfer risk the same way?
Sarasola identified a number of ways that blockchain will impact the industry over time. In the short term there will be operational improvements and ecosystems of value, such as automation and distributed databases. In the medium term there will be better data and measurement of risk and in the long term blockchain will create autonomous insurance, with true peer-to-peer business and automated risk managing.
She added that blockchain will change the way people look at data, but added that the market needs to be careful in that it will also create, or allow people to identify, new risks, such as what happens if there is a ‘black swan’ event, or if event-triggered smart contracts are created that might pay out automatically.
Sarasola concluded by pointing out that many challenges are associated with blockchain, as high stakes technologies and new ways of social interaction are here to stay. As a result the market needs new risk assessment models to cope with the full impact of it.
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