Yesterday IBM announced that the Thai Reinsurance Public Company (Thai Re) launched its ‘Insurer Network’ smart contract solution using IBM blockchain technology.
The non-life reinsurer is one of only two Thai reinsurers listed by The Asian Insurance Review. The benefits of the blockchain solution are claimed to be efficiency, transparency, and speed. More than 10,000 annual reinsurance contracts will be handled by the platform.
Reinsurance contracts can sometimes require quite a bit of manual intervention. Every time there’s a policy alteration, the reinsurance broker, insurer, and reinsurer must coordinate and make sure their systems have the same data for the reinsurance policy. This often involves either paperwork moving back and forth or emails with spreadsheets to be reconciled. Sharing the data with partners in a permissioned manner using blockchain should significantly reduce the level of manual work.
“The COVID-19 pandemic and the need to digitally transform have urged organizations, not only in the insurance industry but all, to bring efficiency to the way we work,” said Oran Vongsuraphichet, CEO of Thai Re.
“Our goal is to make this platform beneficial to Thailand’s insurance industry while also serving the need of consumers. We plan to invite almost 100% of all insurers and brokers in Thailand to leverage this ‘Insurer Network’ blockchain-based smart contract platform within the next two years,” said Pojaman Fuangaromya, EVP of Thai Re.
The solution leverages IBM Blockchain which is based on Hyperledger Fabric.
Blockchain platform B3i boasts many of the world’s reinsurers as shareholders. It’s very first solution was for Catastrophe Excess of Loss Reinsurance (CAT XL).
U.S.-based RiskStream also partnered with the world’s two largest reinsurance brokers, Aon and Guy Carpenter, for a blockchain solution.
While all of these solutions are mainly about automating the back-office processes, some have even argued that the entire reinsurance process – including risk – could be automated through the use of smart contracts. Cedric Edmonds doesn’t agree. Edmonds is from Solidium Partners, which specializes in Insurance-Linked Securities (ILS) and Catastrophe Bonds.
