Blockhain technology company The Bitfury Group said it is partnering with the Washington, D.C. insurance advisory and brokerage firm Risk Cooperative to pioneer blockchain applications in the $60 billion insurance intermediation market.
The Bitfury Risk Cooperative partnership seeks to leverage Bitfury’s expertise in blockchain applications across a range of sectors and Risk Cooperative’s insurance placement platform and partnership model with leading insurers to spur adoption of blockchain in the insurance space.
Dante Disparte, Risk Cooperative’s founder and CEO, sees the deal as positioning his firm as “first movers” in the adoption of blockchain in the insurance value chain.
“This is no small feat, but with Bitfury’s strategic and operational leadership in Blockchain technology, we can be bold in our advance,” Disparte said in a statement.
“Blockchain technology can bring transparency and security to the insurance industry, and can be a catalyst for new insurance business models,” said Valery Vavilov, CEO of The Bitfury Group.
According to the partners, despite the scale of the global insurance industry, which writes more than $5.5 trillion in annual premiums, most natural, man-made and emerging risks remain unfunded or underinsured. They say that legacy insurance industry systems and technologies hinder efforts to tackle this underinsurance challenge.
Bitfury and Risk Cooperative sees themselves being able to enhance trust, transparency, efficiency and security in the origination, underwriting, quoting and transfer of insurable risk.
They also hope to serve as a catalyst to established industry players helping them overcome organizational and cultural apprehension to blockchain by serving as an implementing partner and advisor.
Risk Cooperative has handled insurance placement and risk transfer for Ridge Global, which advises organizations on cyber security. In February of this year, the two firms merged their management. Ridge Global was founded by Tom Ridge, former U.S. Secretary for Homeland Security and past governor of Pennsylvania. Ridge now serves as chairman, while Disparte is CEO.
The Bitfury Group develops and delivers both the software and the hardware necessary for businesses, governments, organizations and individuals to securely move assets across the blockchain.
Insurance interest in blockchain appears to be growing.
American International Group Inc. and Standard Chartered Bank plc announced this week they have piloted what they say is the first multinational, “smart contract” based insurance policy using blockchain, a distributed ledger technology.
Swiss Re is among the members of the information-sharing consortium Blockchain Insurance Industry Initiative (B3i), which launched in October 2016 to explore the potential use of distributed ledger technology and now has 15 industry members. The members of B3i are developing a “minimum viable product,” a blockchained reinsurance property excess of loss contract.
In March, PwC said it was working on a blockchain prototype for the London Market’s Target Operating Model (TOM) Innovation Exchange, which demonstrates how the technology can support claims bordereau management processes, the company said.
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