Parametric insurance is a type of insurance that issues a fixed payment upon the occurrence of an objective or triggering event
HCXI, an AI and Blockchain enabled InsurTech company, is developing a system for the production, management, and exchange of parametric insurance and derivative products.
Parametric insurance is a type of insurance that issues a fixed payment upon the occurrence of an objective or triggering event. With the convergence of digitization, smart contracts, blockchain, artificial intelligence, and the rise in the availability of real-time data, the potential to reinvent the insurance industry has never been greater.
HCXI is building new models of insurance with more firmly defined claims payment parameters enabling their digitization and administration through the transparency benefits of blockchain. By pairing artificial intelligence and smart contracts with parametric insurance, risk bearing entities can reinvent how existing offerings are delivered and significantly reduce frictional system costs. 35% of insurance premium payments are lost due to frictional costs in the system according to a 2015 McKinsey and Company study. Lack of transparency and agency are two key drivers behind frictional costs. HCXI enabled risk products will significantly reduce these costs.
HCXI recently filed a US Patent for a new parametric insurance product to help curb the US’s $150 billion loss health care revenue and patient/provider engagement problems due to patient appointment no-shows. The no-show and late cancellation rates in the US range between 15-20%. The HCXI No-show offering will significantly lower this rate and reduce the need for health care companies to deploy questionable overbooking strategies and no-show fee assessments to compensate for loss revenue due to no-shows. The solution also addresses other pain points in the system and will help mitigate downstream medical cost claims.
HCXI plans to leverage smart contracts and a digital asset framework to operate and administer the underlying risk capital and incentive system pools for parametric products created. By utilizing blockchain technology and digital representation of value, HCXI will reduce the costs and friction associated with regulatory and auditing requirements and improve the transparency of risk-bearing entities enhancing regulatory oversight.
HCXI recently launched its first funding round and landed an initial investment from private equity firm Payment Ventures, LLC based in Washington, DC.
Source: Company Press Release