Metlife Chooses Ethereum Blockchain to Disrupt the $2.7 Trillion Life Insurance Industry
Simplifying Life Insurance
The insurance industry is ill-reputed for its excessive paperwork and formalities that help move business operations along. Claiming life insurance is a particularly tricky matter in that it involves the bereaved to go through a flurry of immediate tasks while also coming to terms with the loss of their dear ones.
These processes are just as complicated on the insurer’s end as they attempt to verify all the necessary documents and ascertain the amount to be disbursed based on the policy taken by the deceased and multiple other variables.
In an attempt to streamline this process, the New York-based insurance firm Metlife has announced that it will utilize the Ethereum blockchain to launch a pilot project centered around the inefficiencies of the insurance industry.
The insurance titan’s Singapore-based incubator, LumenLab, is partnering with Singapore Press Holdings (SPH) and NTUC Income (Income) on “Lifechain” smart contracts platform to expedite the process of policy verification and automatically file for a claim. Should the pilot program yield encouraging results, it could potentially disrupt the $2.7 trillion life insurance space resulting in the creation of new markets, job opportunities, and products to cater to a larger set of customers with better efficiency.
The Mechanism Behind the Project
Per the report, once an obituary is placed with SPH’s portfolio company, the deceased’s family will immediately be informed about the pilot program.
Assuming the family chooses to participate in the initiative, Lifechain will encrypt the deceased’s National Registration Identity Card (NRIC) number using a hashtag algorithm and upload it on the Ethereum blockchain.
The article further notes:
“This will trigger a search on NTUC’s end for a matching life insurance policy. If a match is found, SPH will inform family members within one working day, while ‘Lifechain’ will send an automatic notification to Income via email to initiate the claims process.”
Zia Zaman, CIO of MetLife Asia and CEO of LumenLab, said that distributed ledger technology’s (DLT) peculiar characteristics make it an ideal fit for mitigating the opacity of the life insurance claims process.
As previously reported by BTCManager, blockchain startup HurricaneGuard had developed a blockchain-powered solution to enable automatic insurance payouts in the event of a natural calamity.
On a more recent note, reports emerged on June 3, 2019, how State Farm and the United Services Automobile Association (USAA) were jointly testing a DLT solution to automate the process of automobile claims.