Blockchain, IoT, AI and ML are just some of the tech that is revolutionizing the insurance industry. Also, each of them is the most trendy tech in this decade. Blockchain is rising with cryptocurrencies, IoT is rising with everything and AI and ML are still trying to figure out how can they use the data in the most effective way. But what is the role of the insurtech between them? We will try to figure out the answer in this blog series. In this part, we will talk about blockchain!
Blockchain is revolutionizing many industries based on its promise. What is this magical promise? It's to cut costs, increase efficiency and provide an overall positive change to society. The use cases of blockchain for the insurance industry are countless. For example, you can use smart contracts on your software system, which are self-enforcing agreements embedded in computer code that contain a set of rules which both parties agree on it. When these rules are met by both parties, the contract is automatically enforcing.
So, smart contracts allow for increased speed and cost-efficiency, as well as heightened visibility into a contract’s premium payments and coverage. They can deliver notifications once payment is made also improving transparency and also enable users to keep track of the contract and its performance in real-time.
An additional benefit of blockchain within the insurtech is to simplify the request process. Normally, processing insurance request involves the cooperation of insurance firms as well as third-party firms, a slow manual process that leaves room for human error. Blockchain streamlines this process by collecting records from multiple firms, which in turn saves time. Also, it is reducing the chance of human error. These are the reasons why insurtech companies want to use blockchain tech on their software system. They want to improve the speed and efficiency in which customers can make a request that can create a much more enjoyable experience for customers. As a result, Blockchain may be the key that we have been looking for.