In March, Taiwan’s Financial Supervisory Commission approved a trial of a new blockchain insurance project to make it more convenient for policy holders. If a person needs to change their address and has multiple policies with different insurers, by updating their data once, it will be shared with other insurers.
Similarly, if a person has multiple insurance policies and makes a claim to one, a blockchain smart contract will notify the other companies with which they have cover to initiate a claim.
The eleven insurance companies participating in the “Preservation / Claims Alliance Chain” are Xinguang Life, Cathay Life, Taiwan Life, Nanshan Life, Fubon Life, Yuanta Life, China Life, Global Life Insurance, First Gold Life Insurance, Cathay Property Insurance and Fubon Property Insurance.
The industry body Republic of China Life Insurance Commercial Association is also involved in the initiative. The trial will commence on July 1st and last for six months.
Although the primary purpose may be the convenience, a secondary anti-fraud benefit is not mentioned in the announcement. A side effect is an awareness by other insurers that a customer is the beneficiary of multiple policies. In many cases such as life insurance, that situation may be fine, if the insurance was taken out far in advance. But the sharing of data might highlight that multiple insurance policies were taken out shortly before death. Or in the case of property damage, that someone is trying to claim on multiple policies for the same incident.
Insurance is one of the sectors where blockchain or distributed ledger technology (DLT) is seen to offer major efficiency benefits. There are several insurance blockchain consortia around the world. The two biggest in the West are U.S. headquartered RiskStream Alliance, which is part of The Institutes, and Swiss-based B3i. In China, a consortium is working on blockchain standards for insurance.
