The blockchain mainly solves the problem of trust and security of the transaction, so it puts forward four technological innovations for this problem:
The first one is called distributed ledger, which means that the transaction bookkeeping is completed by multiple nodes **** the same nodes located in different places, and each node records the complete account, so they can all participate in monitoring the transaction legitimacy, and at the same time can **** the same testimony for it. Unlike the traditional centralized bookkeeping scheme, no single node can record the accounts alone, thus avoiding the possibility of a single bookkeeper being controlled or bribed to keep false accounts. On the other hand, since there are enough bookkeeping nodes, theoretically the accounts will not be lost unless all the nodes are destroyed, thus ensuring the security of the account data.
The second is called symmetric encryption and authorization technology, where transaction information stored on the blockchain is public, but account identity information is highly encrypted and can only be accessed with the authorization of the data owner, thus ensuring the security of the data and personal privacy.
The third is called the ****recognition mechanism, which is how to reach ****recognition between all the bookkeeping nodes to identify the validity of a record, which is both a means of identification and a means of preventing tampering. Blockchain proposes four different **** knowledge mechanisms for different application scenarios, striking a balance between efficiency and security. In the case of Bitcoin, for example, proof-of-work is used, which makes it possible to forge a non-existent record only if it controls more than 51% of the bookkeeping nodes in the entire network. When enough nodes are added to the blockchain, this is essentially impossible, thus eliminating the possibility of forgery.
The last technical feature is called smart contracts, which are based on these trusted and untamperable data and can automate the execution of some pre-defined rules and terms. Taking insurance as an example, if everyone's information (including medical information and risk occurrence information) is real and trustworthy, it is easy to automate claims processing in some standardized insurance products.
Policyholder risk management
In today's insurance business, disputes between insurers and policyholders occur from time to time, either because the policyholder provides false personal information to cheat the insurance company, or because there is a disagreement about the exclusion clause when settling a claim. The key to these problems lies in the lack of a reliable means of collecting and storing personal information.
With the advancement of national systematic projects such as the digitization of medical information and the personal credit system, more and more authoritative data sources are emerging, and if these data can be introduced and stored on the blockchain, they will become the digital identities of everyone, which are real and trustworthy, tamper-proof, synchronized in real time, and lifelong validity, and will be of great benefit for the risk management of the insureds.
The first is that the data on it is authentic and trustworthy, and synchronized in real time.
The first is to open up the data between different companies for cross-referencing, so that information such as duplicate insurance policies and historical claims can be found in time to identify high-risk users. Taking the example of the $40 million accidental injury insurance fraud in March this year, Zhou from Yangzhou was insured by more than a dozen life insurance companies and was not detected until manual underwriting. If every time he took out an insurance policy information was recorded in the blockchain, it could soon be discovered and timely measures taken.
The second is that introducing data from different industries into the blockchain can improve the accuracy and efficiency of underwriting and claims. To cite an example of critical illness insurance, if all the medical records of the policyholder, even those of immediate family members, can be accessed on the blockchain, there will be first-hand information about the policyholder's current physical condition, history of illness, and family history of illness, which can effectively eliminate the need to take out insurance with illnesses.
Risk supervision of insurance companies
In the operation of insurance companies, risks due to various reasons occur from time to time, and regulators can only take measures to audit beforehand or restrain afterward. However, as the front-end of the insurance business becomes increasingly open and the companies participating in the insurance market become more and more diversified, the need for ex post supervision is becoming more and more prominent. In the author's opinion, blockchain technology is one of the effective technological means to carry out supervision during the event. As long as the insurance company moves its daily operation process to the blockchain and develops a bookkeeping node (even if it is a read-only bookkeeping node) to the regulator, the regulator will be able to observe all the business movements of the insurance company in real time. For example, the flow of funds and the composition of investments, underwriting and claims data of products, major personnel and management operations, etc., without having to wait for the insurance company to declare them after the fact, so that possible business risks and irregularities can be detected in a timely manner.
On this basis, regulators can also use big data technology to analyze and forecast the nation's insurance market, so as to timely detect and prevent possible systemic risks, or to identify potential protection needs and trends, so as to better provide protection for the people.
Currently, there has been the first use of blockchain technology network mutual aid platform concentric mutual aid, and network mutual aid is and traditional insurance complement each other an insurance model, is the origin of the insurance bar, affordable, make up for the traditional insurance business vacancies.