Bermuda on Blockchain

June 7, 2018 | Bermuda

Xceedance and ChainThat co-hosted an insurance blockchain symposium in Bermuda on June 7, in partnership with Reinsurance.com. The honorable E. David Burt, JP, MP, premier of Bermuda, inaugurated the proceedings, and reinforced Bermuda’s strategic role in accelerating blockchain and insurtech innovation.

The well-attended event provided a platform for blockchain/insurtech experts and leading re/insurers to discuss how smart contracts and distributed ledger technology (DLT) can help the industry streamline point-of-service and back-office functions, boosting collaboration, driving organizational efficiencies, and improving expense ratios. WATCH VIDEO

The panelists emphasized the need for collaboration among carriers and experts to build and adopt homogenous platforms, which would enable high-efficiency, straight-through processing with data certainty. The Xceedance-ChainThat partnership highlights how insurtechs can collaborate to create synergies and take viable technology-driven insurance solutions to the market quickly and cost-effectively.

Reinsurance.com interviewed Arun Balakrishnan, CEO of Xceedance, David Edwards, CEO of ChainThat, and Vikas Acharya, COO of ChainThat, for its RETV video channel.

  • Arun Balakrishnan discusses the role of insurance blockchain in reducing inefficiencies and achieving data-centricity. WATCH VIDEO
  • David Edwards explores how blockchain will be mainstream within 5 years and challenge traditional business models. WATCH VIDEO
  • Vikas Acharya talks about the ChainThat blockchain platform, which delivers significant results across core insurance functions. WATCH VIDEO
  • To watch more videos, CLICK HERE.

The event was covered by The Royal Gazette. To read the post-event summary, CLICK HERE.

For related information, see our ‘Blockchain Perspectives’ Q&As: PART 1, PART 2.

ChainThat was also featured in Insurance CIO Outlook’s ‘Top 10 Blockchain Solution Providers’ list, and has been recognized for its innovative Insurance Blockchain Framework that powers robust enterprise collaboration solutions. READ MORE


Read what the other speakers had to say about blockchain adoption in the insurance industry:

Andre McGregor, partner and global head of security at TLDR Capital discusses the role of blockchain in eliminating insurance fraud. CLICK HERE


Magdalena Ramada, chief economist at Willis Towers Watson discusses the need for insurers to understand blockchain for underwriting the associated risks effectively. CLICK HERE


Arthur Wightman, territory leader for PwC Bermuda emphasizes the application of blockchain in minimizing redundancy across the insurance distribution chain. CLICK HERE


Bermuda Premier the Hon. E. David Burt talks about the strategic importance of Bermuda in accelerating blockchain innovation. CLICK HERE


Doug Alexander, digital enterprise architect at XL Catlin makes a case for rapid digital transformation to meet evolving customer and employee expectations. CLICK HERE




Blockchain could end insurance fraud

Andre McGregor, partner and global head of security at TLDR Capital, described how blockchain can eliminate fraud in insurance.

Speaking at the Xceedance/ChainThat “Bermuda on Blockchain” conference in June, Mr. McGregor, a former FBI cyber security special agent said that one of the challenges related to blockchain was living in a world where you don’t need trust.

“We are creating a trust-less environment,” he said. “We want to create a world where I can have my data stored anywhere and know that is only accessible by those I want to access it. Everyone else is locked out. The way we do this is through cryptographic keys.”

He explained that cryptographic keys were developed and broken in the Second World War and the technology was only being used in business now.

“The way is I have a key, you have a key, the businesses I deal with have a key. Then I get to exchange information when I want on my own time,” he said.

In theory, it should mean the end of fraud. “For the insurance companies it makes fraud almost disappear because now I can trust that entity I’m dealing with knows who I am and when I need to file a claim, that the information is from me and they know it’s me and the situation I’m in to provide that information.”

But blockchain is only strong when computers do not have the ability to go through the trillions of password possibilities. That could be threatened by the advent of quantum computing, which would make highly-powerful computers generally available. They will be able to operate thousands of times more quickly than today’s computers and be able to crack cryptographic keys in seconds rather than weeks, months or years.

“At some point in time, whether it is three years or ten years, quantum computing will exist and allow for the breaking of encryption keys,” he said. “It’s not going to be a problem limited to blockchain. Actually, every single computer that uses any form of encryption will be affected. We are already working on solutions which we are calling quantum proofing to limit and restrict this type of activity.”

WATCH ANDRE MCGREGOR HERE

To know more about the event and hear from other speakers, CLICK HERE

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Insurance can’t avoid the potential and risks of blockchain

Speaking at the Xceedance/ChainThat “Bermuda on Blockchain” conference in June, Magdalena Ramada, chief economist at Willis Towers Watson said that blockchain can speed up business processes in insurance companies, and allow insurers to operate without underwriters when risk is less complex.

“Are we going to be able to assess risk, assess price, pool it and place it in a very autonomous way on platforms that don’t have an underwriter behind them?” she asked.

“For less complex risks, we may just be able to pool them, price them and place them in an automated fashion but that would not work for more complex risks like liability,” she said.

But even if insurers decide that they are not interested in adopting blockchain for their own use, they will need a detailed knowledge of it and how it affects their clients.

“Today, even if we don’t use blockchain as an industry, we have to understand it, price it and underwrite it because many of our clients and the industries of our clients are actually using blockchain, such as logistics, transportation and supply chain, but also real estate and energy markets,” said Ramada.

WATCH MAGDALENA RAMADA HERE

To know more about the event and hear from other speakers, CLICK HERE

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Blockchain’s transformational ability is phenomenal

Blockchain will allow insurers to simplify processes and remove redundancies, according to the territory leader of PWC Bermuda, Arthur Wightman.

Speaking at the Xceedance/ChainThat “Bermuda on Blockchain” conference in June, he said that the ability to transform the distribution chain within insurance and reinsurance is phenomenal.

“The opportunity (is) to simplify the processes and to take out a lot of redundancy; and we know that in the reinsurance industry there is a huge redundancy that sits within the distribution chain,” he said. “It will be a great opportunity for the industry to embrace.”

Mr. Wightman identified three main uses for blockchain:

  • Claims handling: “I would say there is a lot of ability to change the claims handling process, to leverage technology and artificial intelligence in that process.”
  • Underwriting: “There’s an awful lot of ability to transform the underwriting process. As we know within the reinsurance market, there are leaders and followers and there is the ability to take out a lot of redundancy in the contracting process.”
  • Anti-money laundering and knowing customers better.
WATCH ARTHUR WIGHTMAN HERE

To know more about the event and hear from other speakers, CLICK HERE

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Why Bermuda is the best place for insurance innovation

Bermuda Premier the Hon. E. David Burt told the Xceedance/Chainthat conference “Bermuda on Blockchain” that the mid-Atlantic island has created the best environment for technology innovators in insurance.

“Bermuda has a history of innovation,” he said. “Innovation is in our DNA, especially in the insurance industry. We want to be a part of the future innovation that will take place. That is why the government is focused so much on how we can have a forward-looking regulatory environment that can adjust for whatever is coming, whether it be blockchain technology or things that will come from insurtech.”

At the conference, which was also hosted by re-insurance.com in June, the Premier outlined the measures that Bermuda has taken to make it a hospitable environment for innovators.
These include:

  • In November 2017, the government launched a blockchain task force, including a business development group and a legal and regulatory group.
  • It is the first country in the world to have legislation on digital assets, including a regime for the issuance of digital assets.
  • The Bermuda Monetary Authority (BMA) with the government has proposed the Digital Assets Business Act, which has been passed by the House of Assembly.
  • The BMA has proposed an amendment to the Insurance Act to create a regulatory sandbox for insurtech companies to allow them to test products in a constrained environment, easing the development process.

“What we want is for technologists and for those people who are looking to innovate, (to know is that) Bermuda is open for business,” he said. “We have an environment that is second to none. We have service providers. We have an excellent climate and we have very wonderful people who are looking forward to welcome you here,” Prime Minister Burt said.

WATCH THE HON. E. DAVID BURT HERE

To know more about the event and hear from other speakers, CLICK HERE

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Standing still is more dangerous than embracing new technology

Doug Alexander, digital enterprise architect at XL Catlin, said that it was imperative that insurance companies embarked on the journey of modernisation that their customers and staff had been on for years.

Speaking at the Xceedance/ChainThat “Bermuda on Blockchain” conference in June, he said: “If you look at how technology has impacted our lives just in the last few years. If I think of mobile, if I think of cloud computing, if I think of me ordering a cab or ordering food on my mobile phone, it’s a reality. The rate of change is only going to increase.

“We have all done that personally, so it’s just a matter of when are the companies going to start to adopt that and embrace it, and see the positive impact of that. You can’t fight it. It’s a matter of getting comfortable with it and starting on the journey.”

Technological change will not alter the fundamentals of insurance but innovation will improve the industry. “The customer is always going to need some kind of protection against unfavourable circumstances regardless of the line,” he said.

“There will be a shift towards smarter decision making, better risk management and I think this will drive down prices and increase some commodity services, but ultimately it will make everyone smarter. Innovation is going to be the catalyst to push that.”

WATCH DOUG ALEXANDER HERE

To know more about the event and hear from other speakers, CLICK HERE

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