The Future of ClaimsTech: Smart Contracts and Reinsurance

In our last blog, we explained that the potential for Blockchain technology to help achieve business transformation, is still there. Now that the insurance industry has had time to pause and reflect on the potential benefits – a process that has no doubt been helped by this period of lockdown – some CIO and insurance tech specialists are again looking at potential use cases.

“Reinsurance contracts are the obvious use-case for blockchain; complex multi-party contracts that are quite formulaic in nature,” says Robert Crozier, chief architect of customer platforms and head of global blockchain at Allianz.

Hopes are mounting that Blockchain can finally eliminate friction in the administrative processes needed to execute contracts.

“These smart contracts will unlock more digitalisation at the core of insurance and enable more automation, streamlining settlement of claims. Shortening the time to return to normal for businesses and customers by settling claims quickly,” says Crozier.

“There is a considerable amount of manual effort being spent to arrive at a point where they can transact with confidence,” says Antonio Di Marzo, head of products at B3i.

He reasons that smart contracts have the ability to self-execute, doing away with this process. “Today, insurance administration is driven by human decision-making, supported by analytics and machine learning, but manual actions are still required to trigger the execution of obligations. This implies that the execution of contracts is a probabilistic process,” concludes Di Marzo.

Smart contracts are defined by digital parameters and programmed logic, and the contract can self-execute when the agreed conditions are met. This allows the execution to be deterministic and therefore predictable. “At present, processes are supported by technology. Soon, there will be trust in mechanisms like smart contracts, which will enable processes to be executed by technology,” he says. Smart contracts look likely to become part of future business transformation but what else is new in the claims technology of the future?

As a new TINtech report outlines, most transformation projects involve making a specific claims process or series of processes work better – for example streamlining first notice of loss, getting the claim settled faster etc. – but they don’t involve re-evaluating the process first: the mantra must always be: “don’t automate bad processes”.

This is where digital intelligence can enable claims teams to create meaning from data, which can then be used to discover patterns and insights that feed into better customer experiences while, at the same time, delivering operational efficiencies. DOCOsoft has been investing time and resources into delivering such insights and, indeed, we have been offering demos to a number of our clients to showcase our technology in this area. To find out more about DOCOsoft’s plans in this area, contact