IT services company Cognizant along with a consortium of Indian life insurers has developed a block chain solution for secure cross-company data-sharing.
The consortium comprises SBI Life Insurance, Max Life Insurance, Canara HSBC OBC Life Insurance, Edelweiss Tokio Life, IDBI Federal Life Insurance, Birla Sun Life Insurance, HDFC Life, Kotak Life, Tata AIA Life, PNB MetLife, IndiaFirst Life Insurance, ICICI Prudential Life Insurance, Bharti AXA, Aegon Life, and SUD (Star Union Dai-ichi) Life Insurance.
The new blockchain-based data sharing solution has been developed to help insurance companies in reducing the risk of data breaches, fraud and money-laundering, while offering a better experience through improved process efficiency, better record-keeping, and accelerated turnaround time to its customers, Cognizant said.
The solution was built on Corda, a distributed ledger platform developed by R3, a software company working with over 200 banks, financial institutions, regulators, trade associations, professional services firms and technology companies to develop the blockchain platform.
SBI Life operations, IT and international business president Anand Pejawar said: “Blockchain has the potential to catalyze a significant shift in the insurance industry's underlying technology and business models.
“With its model of immutable and decentralized data, and its ability to prevent tampered documents and false billings from falling through the cracks, blockchain can enable insurance providers to introduce new models, reinvent processes, and increase capacity.”
The solution will support insurers in reducing their reliance on data intermediaries and aggregators in securing customer policy details for a wide range of critical purposes including know-your-customer due diligence, financial and medical underwriting, risk assessment, fraud detection, and regulatory compliance.
Max Life Insurance COO V Viswanand said: "By transforming how insurance companies operate and interact with stakeholders across the value chain, blockchain can rewrite the rules of competition in the insurance industry.
"The shared infrastructure provided by the distributed ledger, smart contracts and non-repudiation capabilities of blockchain can dramatically enhance the insurance value chain, and pave the way to greater automation in requesting, exchanging and entering data. The partnership between our consortium and Cognizant is a significant step forward in leveraging the long-term strategic benefits of the technology and turning better customer experience into a competitive advantage."
Besides ensuring real-time availability, the stored data on blockchain can be audited at any time for transparency and consistency, with easy traceability. It also helps in reducing operating costs, avoid duplication of procedures and streamline approvals for participating insurers.
Cognizant insurance global delivery head Arun Baid said: “As a shared source of truth, blockchain opens numerous possibilities for insurers to collaborate more effectively and transparently, make better informed decisions, and create greater trust and accountability, while disintermediating data aggregators.”
Image: Cognizant's Delivery Center in Chennai, India. Photo: Courtesy of Cognizant Technology Solution/Wikipedia.