The digitization technology could be of strategic interest to insurers. Yet before starting down the long road of implementation, individual companies and the industry need to investigate use cases, establish collaborations and better understand the technology’s conditions and limitations.
Blockchain-based technology offers potential use cases for insurers according to a recent report by McKinsey. While banking has dominated so far in terms of financial services blockchain innovation, the consultant identifies three categories among the most promising of 20 insurance use cases from blockchain start-ups; enabling growth, increasing effectiveness in fraud detection and pricing, and reducing cost by automatic key processes. While the technology is ready for exploration by insurers, the report suggests exploitation remains a long way off as to derive value, the distributed system depends on collaboration with competitors, suppliers, or others.