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August 30, 2017
Thirteen Indian insurance companies have rallied together to use a blockchain-like technology to create a central repository of policyholder data, to avoid repeating the registration procedure for holders of multiple policies.
A whole lot of work has to be done in know-your-customer, medical underwriting, financial underwriting, etc, when a customer buys insurance. Duplication of these procedures can be avoided by having the entire data set on blockchain. When the same records are available to a number of life insurance companies in a chain, the cost incurred by them is lower compared to what it is when they were all separately conducting tests and storing records.
There are regulatory concerns regarding data privacy that need to be addressed. Once the system evolves it would help in reducing cost and improving efficiency. The savings in financial overheads due to the new technology are yet to be seen. But the consortium members are confident that greater transparency and reduced duplication would be beneficial for everyone involved. Interoperability with other insurance companies — apart from banks, medical centres, among others — would be the eventual goal.