Blockchain is one of the most innovative technologies of our time, but the unbelievable thing is that it has actually been around since 1991. It is an online ledger that any company on the same network can access, making it possible for car insurance carriers to check on the status of an applicant within a matter of seconds.
This is possible through the use of AI platforms that connect to these Blockchain networks. The more companies on the same network, the more accurate the information will be. Let’s take a deeper look and see why this matters and how Blockchain can forever improve the car insurance industry.
Any auto insurance carrier on the same Blockchain network will have complete transparency, which is an essential aspect of business today. What this means for the industry is that they will be able to see up-to-date information about an applicant wanting insurance coverage.
This aspect makes it virtually impossible for that applicant to fib a little on their application so they can get better rates. The online chain of blocks will contain all the information about that person, making it easy to verify or adjust. The applicant may be able to input some information that is not correct, but the AI system will catch it, find the truth, and adjust the premium rates accordingly.
Online security has been a topic that has been up for debate throughout the years, and rightly so. The more information uploaded onto the web, the easier it is for hackers and identity thieves to access it. That is unless the network being used is on a Blockchain system. This type of system links multiple insurance carriers through the computers in their locations.
If a hacker does get into one of the systems on the network, which is more complicated than you may think, the other computers on the network will notice and isolate the change in information. This will lead the change directly back to the location where it was made, creating an easy trail to follow. That means that if a hacker wanted to effectively gain access to data, they would have to hack into every computer on that network, all within the same time frame.
An aspect of the car insurance industry that has been an issue over the years is the amount of time it would take to get an offer from one of the insurance companies. The agent could apply your information to many different carriers simultaneously, but you had to wait for them to work up your data.
With Blockchain, every piece of information needed is at the fingertips of the carrier. The AI system that compiles the application and sends offers will be able to do so within minutes of inputting the information. Plus, if the consumer accepts the offer, the contract can be signed, and the premiums can be paid on the same site used. This automation improves the speed of the process and decreases the cost that the consumer needs to pay because it can bypass the agents. If you want to see this type of amazing platform in action, check out the iSelect car insurance site and see how automated every step of the way is.
The Blockchain network will follow all the rules that the people in the network put into it. This means that if the governing bodies that set the regulations that the auto insurance carriers must follow are on the same Blockchain network, the rules will always be followed. Once the information has been programmed, every computer on that network will follow it automatically.
This makes it easy and foolproof for each and every carrier that is on the network. They will never have to spend time scanning through the contracts to make sure that they match the requirements because the AI system will do it every time it goes to complete a contract. The company’s legality will be guaranteed because the network will control the stipulations put into it. If anyone tries to change them without the knowledge of the governing bodies, they will easily be isolated and deleted.
Before Blockchain, it was hard for insurance carriers to accurately assess the people trying to obtain coverage. For the most part, they would have to take their word for it and assume that the information provided was accurate. The agent would then have to manually run a credit and background check and input the risk number into their system to get an accurate insurance policy estimate.
Now, since AI systems can access all the pertinent information through the blocks of information, it is nearly impossible for clients to stretch the truth to their benefit to get a better deal. This makes every consumer accountable for their actions. If a discrepancy is found by the network, it can cause a denial of coverage or an inflated premium cost to cover the actual risk assessment numbers.
Blockchain is a technology that has long been needed within the auto insurance industry. In the past, insurance carriers seldom communicated with each other, so a lousy driver could simply jump from carrier to carrier. This may not seem like a big deal for you since it was not you doing it, but it actually affects everyone because it increases the premiums that you all have to pay.
The reason for this is that for every false piece of information given to the carriers that leads to a payout, the premiums of every other client will have to increase to cover the losses. It may not seem fair, and in the grand scheme of things, it isn’t, but insurance companies are in the business of making money. One dishonest person can ruin it for everyone, but thankfully, Blockchain technology and AI platforms have eliminated this issue.