What is it about?
The insurance business is looking for solutions to minimize its operational costs and time to process claims for losses. Blockchain technology gives advantages such as transaction security, process identification, process automation and payment speed. This paper presents an experimental implementation of smart contracts based on Ethereum blockchain for insurance services. A decentralized crypto-token, based on ERC20 standard for smart contract, is implemented. A web-based interface is created for sales of these crypto-tokens. The results from the experimental tests are presented.
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Why is it important?
The insurance sector of economics has begun exploring the application of blockchain technology through significant investments from large and small companies, research by consulting firms and the creation in 2016 of the first B3i oriented blockchain insurance consortium involving over 40 companies. The classic claim process can be improved by using smart contracts and blockchain technology. Information of loss can be sent from the insuree or directly from sensors mounted in the insured object (smart asset) to an automated claim processing application (1). For the relevant insurance policies provided by the smart contract, the customer will receive a real-time confirmation (2). The claim is automatically processed by a smart contract based on business logic, using the information provided by the insuree (3).
Perspectives
The use of blockchain technology in the insurance sector can be implemented with both private and public blockchains. Combined solutions can also be used—to automate claims settlement operations using a private blockchain, and to manage automatic payments with existing crypto-currencies with a public blockchain. The proposed solution with smart contracts for insurance is based on the ERC20 standard. It has been implemented experimentally on Ethereum blockchain. The results of the experiments show that the proposed solution is fully operational in terms of managing automatic payments on approved claims for loss.
prof. Veneta Panayotova Aleksieva
Technical University of Varna
Read the Original
This page is a summary of: Application of Smart Contracts based on Ethereum Blockchain for the Purpose of Insurance Services, November 2019, Institute of Electrical & Electronics Engineers (IEEE),
DOI: 10.1109/bia48344.2019.8967468.
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