American Association of Insurance Services (AAIS), a US insurance advisory organization, introduced the openIDL (open Insurance Data Link), built on IBM Blockchain, to help automate insurance regulatory reporting.
Image: IBM building in Madrid, Spain. Photo: courtesy of Luis García (Zaqarbal)/Wikipedia.org.
Using openIDL, AAIS will help streamline regulatory and compliance requirements while improving efficiency and accuracy for both insurers and state insurance departments, ultimately benefiting the entire industry, including policyholders.
AAIS is a not-for-profit advisory organization that consolidates and analyzes data to create loss reports and rating information for insurance carriers, as well as state insurance regulators.
Insurance carrier data needs to be shared among multiple parties in a safe, secure manner. This is an ideal use of blockchain.
With openIDL, AAIS is updating an antiquated compliance process and pioneering an advanced method where insurers can contribute data directly onto a secure blockchain platform to satisfy state regulatory requirements.
Data is stored on an immutable blockchain ledger where historical and current information is recorded. Regulators are provided permissioned access to view only the information they need.
Participating carriers will also be able to see their own data profile to understand how they compare to the market. Ultimately, the goal of the openIDL is to turn expensive regulatory and compliance requirements into investments in operational efficiency and improved insights.
AAIS has established its own modern infrastructure and makes emerging technologies accessible to Members.
Blockchain is ideally suited to large networks, such as the current AAIS membership base.
AAIS CEO Ed Kelly said: “We recognized the potential for blockchain to streamline the regulatory reporting process for our Member carriers, as well as the opportunity to improve security, accessibility and accuracy of data for regulators.”
IBM has deep expertise in the insurance industry and works with 95 percent of the world’s top insurers helping them adopt new platforms and technologies such as blockchain and enabling insurers to transform the way they do business.
IBM Global Insurance Industry general manager Sandip Patel said: “Simplifying the process for insurance reporting using blockchain will create dynamic shifts in efficiency and provide the industry with new insights that will even benefit consumers.
“This is an exciting example of how blockchain can bring together an entire ecosystem of users and allow information to be shared in new ways to drive real business results. Hyperledger Fabric’s support for private and confidential transactions allows insurers to share data with the network, knowing that they own their data and have control over who has access to it.
“While the initial phase of the openIDL focuses on data sharing and regulatory reporting, the open platform provides a foundation for even broader innovation and new applications in the future, while providing full privacy and confidentiality protection among parties.”
The AAIS openIDL is built on the IBM Blockchain Platform on the open source Hyperledger Fabric. Currently in pilot, several major insurers are in the process of being onboarded to the blockchain platform to provide regulatory reporting data.
Source: Company Press Release