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The US insurance company State Farm is testing a blockchain-based solution to accelerate the subrogation process for automated complaints, according to an announcement published on December 10th.
State Farm is a large group of insurance companies and financial services that provides car insurance in the United States. The organization ranked 38th in the 2018 list of Fortune 500 companies. According to the company's website, it processes 38,300 complaints a day and has nearly 519,000 accounts in mutual funds.
State Farm is working on a blockchain-based solution to accelerate subrogation processes in the insurance industry. The subrogation is a legal right held by most insurance companies to legally prosecute a third party that caused an insured insurance loss, and is usually the last part of an insurance claim process.
State Farm is testing a blockchain solution in collaboration with another insurer to see if it can reduce the time it takes to complete the subrogation process by automatically filling out all subrogation sums.
According to Mike Fields, State Farm's innovation executive, "subrogation is a relatively manual and time-consuming process that physical checks are sent by post to insurers." He added:
"E & # 39; [blockchain] helps us to automate a manual process safely and creates a permanent transaction record of each payment that can be easily verified for accuracy. It also has the potential to reduce the time it takes for consumers to receive the deductible reimbursement. "
Global insurance companies have integrated blockchain technology into their operations. Last month, the Japanese insurance company Sompo collaborated with the pan-African digital payment platform BTC Africa, also known as BitPesa. The partnership is focused on the "digitalisation of global remittance services".
In September, China's leading insurance company People & # 39; s Insurance Company (PICC) partnered with the blockchain VeChain platform and with the global quality assurance and risk management company DNV GL to make its business more efficient in terms of time and costs. The partnership also aims to improve fraud prevention, compliance with Know Your Customer (KYC) and claims experience.
Meanwhile, market research firm MarketsandMarkets predicted that the blockchain in the insurance market will grow to $ 1.4 billion by the end of 2023, with a compound annual growth rate of 84.9%.
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