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The following is an opinion article written by Dimitris Hiotis and Aude Saint-Paul by Simon-Kutcher. The opinions expressed within the article are not necessarily those of the insurance industry.
Blockchain is a topic from hype. But what can it really be used for? How can it really help the customer? A common reproach to blockchain enthusiasts is that, rather than looking for problems for the blockchain to be solved, they should focus on concrete challenges, in particular customer pain points, and identify solutions, regardless of whether they use blockchain or not.
So, let's take a look at an obvious challenge in the insurance industry: the management of personal data. From the insurers' point of view, it is a technological and regulatory nightmare. And it is also a customer's nightmare.
An insurance client usually faces two important pain points.
First of all, the fear of losing control of personal data as soon as it is handed over to an insurer: will other suppliers be able to access my medical records through my health insurer? Or is there a risk that someone will violate their systems and access the results of my health tests? What happens if I sell my data without my permission?
So, very often, frustration with the need to repeat data entry processes several times (for example, when a customer engages with a broker who works with multiple underwriters, all of whom must perform the same verification process).
These problems are particularly acute in health insurance, where customers share sensitive data. So, how can we solve this problem? Could blockchain offer a solution? In our opinion, the answer is: most likely.
One of the main causes of the problems mentioned above is that at the moment many insurers struggle to get a 360-degree view of their customers. Data can exist in one form or another, but can be extraordinarily difficult to "stitch together" on an individual level.
Blockchain can enable "profile stitching" and do it in such a way as to protect data privacy and security. Equally important is that it can do so in order to restore control to the client, allowing each individual to control which organizations access their data.
Such as? Let's focus on a high-profile blockchain start-up, Civic. The concept is a blockchain-based authentication solution. It is essentially a process of verifying the identity transferable from one service to another: a single input of a client's personal identity can be verified by any organization on the blockchain, without the client having to provide the same data twice. These data are verified by Civic (or other identity verification partners), certified and anchored to the blockchain in the form of non-decodable data.
What is particularly interesting about this is that Civic does not directly store any personal information about the blockchain. On the contrary, it stores the certificates of this information as a reference, thus restoring the control of the data in the hands of the customer. The customer alone has private keys to access information, which means consumers are the only people able to authorize access to their information in real time.
This is a very important proposal for the insurance sector. Imagine that a service provider, such as a car insurance company, needs access to a client's bank account information. After communicating with the user, the auto insurer sends a request for data to a previous validator, perhaps a bank. This validator retrieves the hash for the information requested by the blockchain to certify it with the information previously provided by the customer. If everything occurs, the validator is paid for these services and the machine's insurer approves the customer's identity.
This example could be extended to other insurance lines, in particular health insurance.
Today, a huge challenge in the health sector is how to manage health records. As patients move between healthcare providers, their data spread among organizations, making it difficult to get a transparent, complete and accessible view of their medical history. This is where blockchain could help.
In fact, several start-ups are already working on solutions like Medrec or Medicalchain. Medicalchain uses blockchain technology to securely archive medical records. Medrec is developing smart contracts that connect patients and providers to the addresses of existing medical records (which means that it is not even necessary to record information directly, rather it encodes the data that allows records to securely access patients, unifying the data. access to data through disparate suppliers).
The list of examples like this could go on and on, and it is not surprising that start-ups around the blockchain multiply. Time insurers begin to think about how to exploit the potential of the blockchain to improve the customer experience.
Regarding the Authors:
Dimitris Hiotis is partner and global manager of leisure, travel and transport at Simon-Kucher. Aude Saint-Paul is a senior consultant at Simon-Kucher in London and has worked on a wide range of commercial programs in the insurance sector and other B2B and B2C sectors.
Simon-Kucher & Partners is a global consulting firm specializing in TopLine Power®, which includes strategy, marketing, prices and sales. Founded in 1985, the company now has over 1,200 professionals in 38 offices worldwide. The practice is based on practical strategies based on the evidence for the improvement of profit through the upper line. Simon-Kucher & Partners is considered the price-setting consultant and the world's leading thought leader.
