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Insurance’s Biggest Disruptor: Blockchain Technology

Blockchain digital record-keeping technology may be today’s biggest disruptor in the insurance arena, David Princeton, P&C claim lead at M3 Insurance told this month’s Construction Practice Group teleconference.

Blockchain technology — adopted by organizations ranging from Nasdaq to Walmart – allows for the exchange of items of value and is essentially designed to cut out the middleman, he said. It can be used, for example, on claims for loss of business income. The new technology can review past financial statements, and make calculations that cannot be edited.

Blockchain technology is among the factors that will make people look at service rather than price when they select carrier partners. RPNI members will face the challenge of providing service even when delivering a difficult message, he added.

With blockchain data and various forms of artificial intelligence providing answers to many questions (See earlier blog), brokers will be expected to answer more complex questions, he continued. “I get an email almost every minute asking for strategic guidance on a complex situation. If I don’t get back to the client until the next day, I’ve already failed him.”

Artificial intelligence can be helpful here, Princeton said, by reading incoming email and prioritizing it according to parameters assigned by the agency.

Third party claims administrators

Third party claims administrators are most effective in the workers comp arena, as it is difficult for smaller carriers to have the expertise and staff needed to provide good service in all states, Princeton said in answer to a question.

In other areas of insurance, third party vendors are less than ideal. “We want to control the claims and differentiate ourselves,” he said. “When you use third-party vendors, you lose ownership of your brand.”

Additional reading

Inc. Magazine: Blockchain Technology Is Set to Disrupt Every Industry

Business Insider: IBM wants to use the technology that underlies bitcoin to help prevent major foodborne outbreaks like salmonella


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