美国当地时间1月9日，以贵阳市人民政府王玉祥副市长为团长的代表团在Hilton Los Angeles - San Gabriel召开“洛杉矶·贵阳区块链研讨会”并获得空前成功。出席人员有全球比特币基金会主席MR.Brock Pierce、MS.MILANA RABKIN STEM公司创始人CEO等商界和政界代表百余人，贵阳互联网保险金融投资有限公司董事长艾文华在会上做主题为“区块链是驱动保险创新的新动力”的交流发言。
Block Chain is the New Engine to Drive Insurance’s Innovation
Today I want to discuss Block Chain, the new emerging thing, with you. It is predicted that 10% of global GDP will come from the use of Block Chain technology in 2025, but today the global GDP created by it accounts for only 0.025%. That means Block Chain technology is still in its infancy, and it has a huge space for its development, will change the existing business and technology, and will bring pioneering change for the world.
It is relying on its own incomparable advantage that Block chain can produce such a huge commercial value. And Insurance plays an important role in Block Chain’s practical application, as the point of view put by Wanghe, the vice president of Chinese largest property insurance company, PICC, goes that, " Insurance is undoubtedly the best ‘typical scenario’, Block Cain will be the new engine that drives insurance’s innovation. It brings us not only a new technology but also business model’s innovation and iteration which is based on ‘the bottom change’.” While Block Chain is rolling like a wave into our daily life, more and more Chinese insurance companies such as PICC, PAIC, YGBX, Zhongan Insurance, etc. have also bring in it.
Part 1 Block Chain contains tremendous value
More than 200 events about financing and mergers & acquisitions have been occurred in the Block Chain field since 2012. And the total amounts of financing exceeded to over 100 billion RMB. In the first half of 2016 global Block Chain technology investment reached its extent of 300 million dollars. In September last year, the largest investment project of Chinese Block Chain had its amount that was more than 20 million dollars. The investment for Block Chain project is expanding and accelerating. This new emerging technology is about to make the insurance’s model and technique change, so that we can predict that the revenue of insurance services may increase to $235 billion by 2021.
What exactly is Block Chain Tech? As for this fashionable but unfamiliar word, we get an understanding that it is a kind of technology which uses decentralized consensus system to maintain an integrating, distributing, and unchangeable database for account books. It can let the participants in Block Chain set up a unified system of account books on the premise of no established trust relationship. The key feature of Block chain is decentralization that is used by us to distribute calculation and storage. It does not have centralized hardware or management institutions, but the advantages like unchangeable information, highly opened information, noninterference as well as anonymity.
In recent years, the concept of “Block Chain +” gradually become a bright spot in the financial industry. And the vigorous development of Block Chain technology provides an excellent chance for the innovation of the insurance industry. People specializing in Chinese insurance industry are trying to work with the method of Block Chain: Zhongan online, the internet insurance company, is building a service platform based on the exploitation of Block Chain’s products; YGBX, the traditional insurance company, is launching insurance card list based on Block Chain; Mutual aid association--Shanghai Zhongtuo Network is writing its member information on Block Chain. Block Chain technology that is increasingly mature and widely used in the insurance industry will bring the insurance forms subverting revolution.
Part 2 Three pain points of the innovation in the insurance industry
Insurance is organized by people voluntarily with common requirements and people facing the same risks. It is a form of accepting the advanced compensation levy for loss. The origin of the insurance loss principle is, "one for all, all for one". Currently the three prominent problems in insurance innovation are namely the trust, security and experience.
First of all, the trust for “object of insurance” is a big problem to deal with urgently. The objects of insurance considered as the precondition of insurable interest are people’s life and body, and are insured object’s property and related interests. Insurance humbug exists in the insurance industry, especially in the situation where insurance claims are involved in compensation and property damages. Many cases are spread out the elements of tampering with the object of insurance due to the unmatched information. For example, policy-holder, insurant and beneficiary with the purpose of making themselves or others obtain insurance money diddled money of vehicle insurance, property insurance, medical insurance, etc. by fabricating the object of insurance, insurance accident or creating insurance accident. Meanwhile, the same to solve the customer’s trust in insurance companies, loss of customer policies or catastrophe that led to the loss of the policy, the death of the customer and the beneficiaries, which rely on the insurance company’s self-recognition and spare no effort to find other beneficiaries. On the other hand, the special nature of purchasing insurance, which the characteristics of compensation after the first payment, is doomed to solve trust issues of insurance corporations.
The second pain point is information security. We must ensure that information is true and reliable and the time of it can't be modified. "Time" is the key point of the management of the insurance industry. Either insurance following claims or Anti-dated B/L are involved in the matter of time. Block chain’s "time-stamp" technology provides a solution to the problems mentioned above. At the same time, its other functions such as "unchangeable", "non-repudiation" and "traceability", etc. provide us tools rather than experience held by people to solve problems.
Last, Insurance service is complained by customers all the time. To a certain degree, the hardness and tardiness of claims exist in insurance service long time. Insurance is different from the merchandise, its contradiction between the advanced cost and the delayed service restrict the industry’s scale. The reasons are described as follow: 1, it is difficult for customers to figure out the insurance liability through reading the obscure clauses; 2, staffs of some insurance companies are not familiar with the materials and processes of the settlement of claim, and they spend much time to verify them so that customers can not understand the different attitudes that polite before and haughty afterward. Finally customers feel bad to the experience of buying insurance.
Part 3 The role of the chain block in the insurance’s innovation
Characteristics of Block Chain technology, as security, trust, automation, traceability, etc., can provide a different perspective and new realization path for insurance industry’s innovation in the field of accurate pricing, information security, operational risk controlling, insurance counter-fraud, personalized product’s research & development.
From the Angle of mutuality, Block Chain combined with intelligent contract will lead to autonomous management of insurance business. The range and price covered by insurance products will adjust themselves automatically because the inputting conditions and data changed during the period of executing the contract. Such as car insurance quote system reflects the use of the car and the driver’s driving behavior in the process of quotation through the method of Block Chain technology, evaluates the level for the driving risk, and ultimately carries on the accurate pricing. The pricing mechanism shared with fair, to some extent, will promote the enthusiasm of higher quality customers to buy insurance.
Block chain is built based on the internet, any access to the internet port can be accessed into Block Chain. And any identification, physical or intangible asset, personal record, proof, and even public record can be migrated to Block Chain to form a "digital ID". Depending on the reliable and unchangeable database, Block Chain will completely change people's way of registration and verification of identification and property and other relevant information. All kinds of data information and social activities will no longer rely on third-party individuals or institutions to obtain or establish credibility. The whole network’s Multi-party verification takes a shape of “verify by itself” model of the data information. In the era of Block Chain, insurance company can realize the full verification and management to customers’ transaction information including personal identity information, medical health record, asset information, ownership information, transaction records and so on. The most important work for an insurance company is to ensure the safety of policy information. And most insurance companies use paper voucher and the backup of computer data to manage the policy information. However, it is easy to lose customer policy due to too much reliance on insurance company’s system data and its credibility. Moreover, catastrophe may also cause the disappearance of insurance company’s data. At the right moment, the electronic policy, the foundation of Internet insurance’s development, emerges with the support of Block Chain technology. Because Block Chain’s data may not lose, some insurance companies are studying a storing way of putting the policy information, customer information and claims into Block Chain, in order to avoid the impact caused by accidents on the data security.
Operational risk controlling
Insurance operates risk which is an objective existence. Based on Block Chain’s feature of authenticity and unchangeable data, the intelligent contract is helpful to simplify the process of dealing with policy claims, to reduce the processing cost and the rate of being cheated. It will eliminate the risk in the bud stage if we warn the risks beforehand, make regulatory risks in the matter, and keep away from fraud risks afterward. Insurance companies can use Block Chain to raise the standard of risk management, in order to reduce operating costs and risking rate.
The principle of honesty is regarded as the biggest principle for insurance industry to survive. Striving for profits and avoiding disadvantages are the nature of human, but it is impossible to avoid fraud with moral constraint simply. The insurance industry can realize digital management for personal data by Block Chain technology, thus, the probability of identity and claimant fraud will be reduced greatly, so that it can increase people's trust in insurance products.
In the era of Block Chain, technology like biological identification, encryption algorithm and distributed technology make sure to “tell the truth” to customers when they are covering insurance. These technologies enhances the ability to control risks after insurance companies change their way of distinguishing risks from human into machine. Block Chain’s application in the field of insurance’s counter-fraud includes the following 2 aspects:
First, Block chain can dredge data between different companies. They can refer data each other so as to immediately find the information such as repeat insurance, historical claims, etc., and find the high-risk users timely. Take an accidental injury insurance fraud involved into 40 million RMB, which happened in March last year, as example. Zhou, from Yangzhou city, insured life insurance at more than 10 companies. He didn’t realize that he was cheated until the manual underwriting found out the problem. If the insurance companies recorded all of his insured information in Block Chain, they might have found the fraud and taken measures in time.
Second, introducing different industries’ data into Block Chain can improve the accuracy and efficiency of underwriting and claim verifying. For example, If insurance companies can inquiry all diagnosis records of policy-holders and their immediate relatives in Block Chain, they will have the policy-holders’ primary information, including current physical conditions, historical disease of themselves and their family, etc., and will effectively eliminate the issue that someone with disease insures insurance.
Promoting personalized product’s research & development
The law of large numbers of insurance business is that the bigger the homogeneous population is, the easier that insurance companies could develop the same type of insurance products, and the insurance risks are more likely to break down. Currently, the insurance service innovation that has deeply market demand is an important factor which restricts the development of the insurance. Thus, Block Chain technology provides an effective solution to the innovation for personalized insurance products. Block Chain’s distributed database breaks through the obstruction that unequal information restricts the insurance business’s development. Block Chain uses its characteristics, such as limitless time and space, and time spot, to flexibly adjust insurance products’ coverage and pricing, to make corresponding underwriting policies, to expand products’ coverage effectively, to satisfy all demands for personalized, customized, differentiated and fragmented products, and to promote the internet insurance products’ self-evolution. Such as, the vehicle insurance which is priced according to the number of using days, the personal insurance which is insured according to a special event or period, etc.
Enhancing the insurance service’s experience
Through Block Chain we can establish the application of insurance, such as health insurance claims, vehicle insurance claims, etc. Customers only pay the individual self-paid part. And claims will be automatically settled by relevant institutions and insurance companies. This method can greatly improve the insurance service’s experience so that the intelligent contract based on the consensus mechanism is easy to understand. At the same time, Block Chain provides technical support for real-time underwriting, automatic claims and self-help preservation, and a new experience to customers.
Part 4 A new model of mutual insurance under the application of Block Chain
Today, the biggest opportunity for the mutual insurance is that the technology represented by the Internet, especially the Block Chain, has brought technical support. Block Chain satisfies the distributed requirements, moreover, it has mechanisms for consensus, unchangeable, and non-repudiation, and thus provides logical basis and realizing possibility for “post trust”. At the same time, the intelligent contract offers a strong support for data transparency and efficiency. Thus the mutual insurance may become the ultimate form of the insurance industry in the future.
The new mutual insurance mode under the application of Block Chain will change the role of the insurance company from the traditional direct risk absorber and processor into a professional consultant of risk management and a manager of venture capital pool. No longer relying on the insurance broker or intermediary, market participants can use Block Chain technology to systematically create their own risk pool system so as to manage their own risks in a more direct and active way.
The continuous development of decentralized mutual insurance organization promotes the insurance industry to enter the era 2.0 of mutual insurance. Each of market participants does his duty under insurance business rules, thus the ecosystem of the insurance industry will be possible to achieve full autonomy, so as to create an insurance society which is full of transparency, reliability, satisfaction, trust and loyalty.
“All for one, one for all” is the essence of insurance. With the development of science and technology and the improvement of people's awareness of risks, cooperation, the important and primitive means to resolve the risk of human society, integrates into the modern insurance system actively and rationally. In June 2016, three Mutual Insurance Companies were officially approved, which marked that Chinese mutual insurance completed the shift from "possibility" to "reality". However, we are still facing up to many challenges before we turn the "ideal" into "reality". Let us wait and see whether the mutual insurance companies could start a new road with the Block Chain technology or not.
There has some good conditions for innovative pattern called as “Block Chain + Mutual Insurance” in Guiyang. Some complete big data companies which undertake careers as data mining, data cleaning, data modeling and data securing have been set up in Guiyang. The city gathered advanced Crowd-funding thoughts and many business forms through the first Crowd-funding company named “Guiyang Crowd-funding Finance Exchange”. The road logistical enterprise leader named “Truck Help” which has 2 million truck drivers has also grown up in Guiyang. Recently, Guiyang is relying on its rich tourism resources to build the world’s first brokerage firm undertaking big data travel insurance. Under the background of Block Chain, it is convenient for the crowd which has the feature of assembling and risk homogenization to develop products and to explore precise marketing. Furthermore, not only can the crowd carry out their risk management but also can unify the service standards. Thus, this will be the best practice and exploration of mutual insurance.
In summary, Block Chain can build the best scene for the insurance industry. As one of the three carriages of the finance, the insurance industry will get its new way with new opportunity.