The reinsurance market is ripe for disintermediation and it is no surprise that it is one of the many sectors exploring how Blockchain technology can help enable efficiencies in what can often be a fragmented operating model. The insurance market is widely seen to be lagging behind banking in terms of technological innovation and adoption.
The insurance market as a whole is reliant on data supplied from multiple sources including the end client, broker, reinsurer and various service providers such as administrators and custodians. Analysis by PricewaterhouseCoopers (PwC) calculated Blockchain adoption in the reinsurance market, for example, would result in cost savings of up to $5 billion.
The PwC data highlighted that between 5% and 10% of premiums are derived from reinsurance expense ratios. The PwC study added Blockchain solutions could remove between 15% and 25% of expenses in the reinsurance industry. Integration of Blockchain could reduce the operational workload around data processing, by streamlining processing times and costs of placement.