The financial regulator for Taiwan lately gave 11 insurance companies the green light to test a blockchain network that analyzes insurance policy issuance and modification. This will offer insurance companies and insurance buyers a new level of efficiency and potential cost-savings in the long-run, April 9, 2020.

Blockchain for Interlinked Insurance

Financial services are the single-most disrupted industry since the arrival of blockchains commenced with Bitcoin in 2008. Adding to that mound, Taiwan’s insurance industry is primed to contribute a new degree of convenience to users.

A person with various insurance policies across multiple insurers can trigger a call on policies by presenting a claim for just one, given the other insurers are a part of this blockchain network. If a resolution is needed, for details like residing address or nominee, this can be done for several policies via a single application. But the advantages are not just for the consumers. They are multi-fold for insurance companies as well.

For example, if it is discovered that someone who had a long-standing life insurance policy purchased a few more policies with other insurers days before passing away, this would allow insurers to pursue fraud that was otherwise difficult to catch onto actively.

Numerous insurance majors, like Allianz, have also adopted blockchains to enhance their back-end processes. By providing insurers the capability to work collectively to counter fraud and streamline paperwork for claims, long-term cost savings are clearly on the cards.

Financial Fraud and Blockchain

The idea that the financial world is so caught up in “blockchain mania” is because of the technology’s capability to synergize industry-wide applications. Before this, operating together was a tiresome task, demanding a notable amount of human capital and communication.

With blockchains, this can be done over a shared network those folds up as an interactive database. Money laundering and other modifications of financial deception can be cut down on, reducing losses for financial institutions that are otherwise inadequate to crack down on these activities.