Both onboarding and a claim that occurs involve a lot of work for insurers. For example, the items to be insured, the medical history or the living situation have to be precisely determined and evaluated depending on the type of insurance. This results in both the amount of premiums to be paid for the policyholder and the payout in the event of a claim. Many of these processes in the insurance industry are at least partially digital, but are still very labour-intensive. This will change in the future with the self-sovereign identity. Added value is created by the digital identity for insurers as well as for their customers.
Bureaucratic structures burden the insurance industry
Even today, work processes in the insurance industry are still characterised by bureaucracy and are sometimes paper-heavy. On the one hand, this is due to strict legal regulations, but the insurance industry also has a vested interest in collecting as much data as possible about its potential customers. Customers, in turn, are forced to fill out long applications and disclose many details about their lives. If they are in need of quick help due to an accident, this is particularly inconvenient. Furthermore, the sensitive customer data must be protected by the company within the framework of the GDPR – this is also associated with not inconsiderable costs. Since customer data must also be exchanged between the insurer and its branches, new security risks arise.
Blockchain offers the insurance industry enormous potential for change
Too long a processing time in the event of a claim is not only bad for the customer. A negative rating is quickly placed on the internet if help is not provided in time. Insurers therefore have an interest in helping their customers as promptly as possible. Self-sovereign identity can speed up the process and still make the review accurate. For example, patients can have a digital certificate issued by the hospital or the treating doctor and simply release the necessary attributes of the proof to their insurer.The issuer verifies his proof so that the insurer no longer has to validate it.
This benefits private health insurance in particular. Theoretically, however, certificates for physical assets, including their monetary value and condition, can also be created and stored in the blockchain. Insurers can exchange information. Onboarding is thus simplified. The customer only has to agree to the transfer of the corresponding attributes via wallet. With SSI, insurance policies can also be stored in the wallet. This means that insurance policies can no longer be lost.
SSI in the insurance industry creates added value for all stakeholders
Sensitive data such as medical history remain with the user with SSI, as they only agree to the transfer of certain attributes from the blockchain to their insurer. For insurance companies, this means having to store less personal data. This reduces the effort for data protection. First and foremost, however, insurers benefit from the leaner workflows. The customer no longer has to fill out lengthy forms due to eliminated verification steps. If an on-site check at the policyholder’s premises becomes necessary, the insurer can release the corresponding attributes to its local branch. The customer then simply legitimises this transfer from his digital wallet.