What challenges does the insurance industry need to face in rebuilding the trust relationship in the insurance industry?

Securities Times reporter Pan Yurong

Source: Securities Times

Editor's Note: The original title is "The Blockchain Reconstruction Insurance Industry Trust Relationship"

Observing the global insurance industry, it is not difficult to find a phenomenon. In a society with improved efficiency and fair system, the cost of trust is low, and the price of insurance products is relatively low. Where the cost of social trust is high, insurance products are not only less, but often sold. expensive.

The problems facing the insurance industry are all related to trust. On the one hand, insurance companies are afraid of customer fraud, and every person who comes in as a “thief” scans with X-rays, which is “nuclear protection”, which affects both efficiency and cost; on the other hand, customers always Suspected that the insurance company is unfair, it should not be compensated, but less compensation. Because the information is not equal, the management is opaque, and everyone can't trust each other.

The essence of insurance is mutual help, but a society with high trust costs is essentially harmful, and mutual assistance is difficult to carry out efficiently. The emergence of blockchain, using distributed data storage, peer-to-peer transmission, consensus mechanism, encryption algorithm, etc., provides a new hope and possibility for "reconstruction credit".

In the world of insurance, the relationship between individuals and groups is “I am for everyone, everyone is for me”. The advantage of building a good trust relationship is that insurance companies can save a lot of social costs due to fraud, because of the investigation. Confirmation brings operating costs, and the cost of time due to the cumbersome process can be transferred to the insured. For the insured, the blockchain's smart contracts, network-wide consensus, non-tamperable and distributed accounting ensure that their data is shared on a security basis, not leaked, trusting insurance companies, and enjoying themselves. The benefits of reduced rates.

It is true that there are too many challenges to deal with the new ecology of trust relationships through blockchains in insurance scenarios.

First of all, the openness of the blockchain and the contradiction between the internal and external data of the industry greatly limit the realization of the value function of the blockchain. The insurance industry chain is long, and the upstream and downstream industries include medical, health, and pension industries. The external environment for data sharing is not ideal. Secondly, the fairness brought by transparency will break the existing distribution pattern of interests in the insurance industry. For any industry, technological transformation is easy and it is difficult to touch the interests. Thirdly, the maturity of the development of blockchain technology also affects the application of the industry. At this stage, a lot of exploration and investment in the blockchain will test the financial strength and leadership of the insurance institutions, and all parties need to work together. In addition, the application of blockchain to the challenges brought by regulation is also worthy of attention, not to rule out the blockchain may also lead to new problems and risks.

Despite this, as insurance companies have entered the blockchain, they have tried first in the simple, marginal and safe places, and gradually infiltrated from outside the industry. In the future, the blockchain that grew up in the insurance scene changed. It will not only be an insurance industry, but an important infrastructure for social management. At that time, the social nature of insurance and the social nature of the blockchain will be integrated.