American International Group (AIG), along with IBM and Standard Chartered Bank has successfully completed multinational pilot that is designed to ease industry's most complicated insurance policies that is powered by blockchain.
According to the reports by IBTimes, the blockchain pilot solution was built by IBM and is based on Hyperledger Fabric. AIG, IBM and Standard Chartered together tested commercial insurance master policy that was written in the UK and three local policy in the US, Singapore and Kenya.
The three jurisdictions were chosen as the US marks a large and complex market, Singapore is a growth market for Standard Chartered, and Kenya has a specific regulatory requirement, known as ‘cash before cover’.
The policy was converted into a "smart contract" that offers real-time shared view of policy data and documentation. Also, the blockchain pilot demonstrated ability to include third parties in the network, including brokers, auditors and other stakeholders, thus providing them a customized view of policy and payment data and documentation, a statement said.
“Our pilot proves blockchain has a powerful role to play in the future of insurance. Any technology, including blockchain, that can increase trust and transparency for an industry whose pillars are built on that, should be fully explored. We're excited to be delivering innovation that matters to our clients – and co-developing key components of this new technology together,” Rob Schimek, CEO of Commercial, AIG said, as reported by IBTimes.
The partners executed this blockchain initiative in multinational risk transfer, which is one of the most complicated areas of Commercial Insurance. It is aimed to better understand the potential of blockchain technology for reducing friction and increasing trust in other areas of the insurance value chain.
“As a global bank we have to ensure consistent, trustworthy and secure financial transactions, be that as part of our business or as customers ourselves. By creating a process by which we can arrange multinational insurance contracts through blockchain we not only have transaction security but contract certainty across multiple business locations,” Emily Jenner, Head of Insurable Operational Risk at Standard Chartered, stated.
