Blockchain can be explained as an encrypted protocol developed for secured digitalized information. It is made of an encrypted database considered as a block. Presently, blockchain holds a key role in the insurance sector. Blockchain in insurance sector is used for claim detection, fraud detection, payment modeling, reinsurance management, and claims management. Blockchain is used as an immutable and shared ledger for tracking assets, trust-building, and compiling the transaction. Blockchain in insurance is utilized for faster data processing, security, and recording the transactions.
There has been a significant rise in the number of false insurance claims. Attributing to this, fraud risk management has become the key concern for insurers. Frauds like these are fueling the expense of both policyholders and insurers. Dealing with such frauds is a tedious task. Subsequently, to forestall or deal with such practices blockchain is broadly utilized by various insurance organizations. The boosting need for handling such cheats is fundamentally uplifting the growth of the global blockchain in insurance market. Blockchain handles such misrepresentation claims with reasonable evidence. It essentially builds up a security system that confirms any insurance guarantee quickly.
But, the steady need for fuel sources to run the blockchain programming for encryption and decoding is hampering the growth of the global blockchain in insurance market. Trust and transparency are critical concerns for the insurance sector that is essentially offered by blockchain. The consistent need of enhancing productivity and case processing is foreseen to provide several avenues for the market players in the coming years.
The global blockchain in insurance market is divided into product, application, components, and region. The product segment is classified into life insurance, auto insurance, and health insurance. In terms of application, the market is segregated as client onboarding, claim processing, and underwriting. The components segment is bifurcated into services and tools.
Based on geography, North America is likely to lead the global blockchain in insurance market within the forecast period. This is attributed to the increased adoption of blockchain in the region. Besides, Asia Pacific is also set to grow at a significant rate in the coming years.
The key players leading the global blockchain in insurance market are Applied Blockchain, Bitfury, BlockCypher, Auxesis Group, Algorythmix, BTL Group, Digital Asset Holdings, Cambridge Blockchain, Factom, RecordsKeeper, Guardtime, Microsoft, Earthport, IBM, iXLedger, Symbiont, SAP, SafeShare Global, etc.
To cite, a project by Linux Foundation has introduced blockchain and open-source insurance in the insurance sector. The two lead groups are using the new collaboration and blockchain to launch the concept of data sharing for the development of a new solution.