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50 | The South African Insurance Industry Survey 2016
insurance. The potential impact of blockchain on insurance capital and if your profile meets the level of accepted –– Motor vehicles with built-in sensors will provide data
companies and the industry is illustrated below. social capital, as required by the smart contract upon a vehicle involved in an accident which will provide
algorithm, you can qualify for this specific product. the blockchain with the number of sensors impacted
Smart contracts Upon updating your status on Linkedin to unemployed as well as the average force. Based on the conditions
A smart contract is a piece of software that automatically and actively putting yourself up for employment on a job programmed on the smart contract, this will result in
verifies the contract and thereafter executes the agreed platform, you can automatically qualify to be paid out an the claim being paid out before a tow truck arrives at
terms. The following innovative ways have been proposed unemployment income till you update your profile on your vehicle.
for smart contracts to be used on blockchain: Linkedin to employed or your profile gets employed on
the job platform. –– Motor insurance premiums which are charged on a trip-
–– At the London FinTech Hackathon, the winning team by-trip basis.
utilised smart contracts to develop an innovative –– Agricultural insurance where there are payouts if
solution in the provision of late flight insurance. rainfall exceeds or is less than 10 percent of average –– Foreign health insurance gets billed to you on a daily
Their business case was based on the fact that rainfall figures in your geographic area as compared to basis upon your cellphone detecting that you are out of
550 000 airline passengers in the UK did not claim on the previous three years. Weather data is fed into the the country.
their insurance for delayed flights partially due to the smart contracts from an independent source. Upon the
difficulties experienced in the claims process. The team condition being met, a claim payment is instituted in Two motor vehicle claims have been deliberately included
presented a smart contract system that provides direct compliance with the terms of the contract without any as we predict that the impact of self-driving cars to the
compensation for affected passengers by connecting human intervention. personal auto insurance industry could result in shrinkage
data feeds with flight information and smart contracts of this market to less than 40 percent of its current size.
on the blockchain. The Internet of Things This is just another example of the rate of disruption within
The Internet of Things (IOT) refers to a proposed the industry.
–– The idea of an innovative unemployment insurance development of the Internet in which everyday objects
which relies on Linkedin. There are underlying terms have network connectivity, allowing them to send and With blockchain being a relatively new and untrusted
and conditions around how long your profile must have receive data. The Internet of Things allows us to introduce technology, the following is anticipated:
existed as well as further requirements, but the premise innovation in the claims process through the blockchain as
behind this is that each person has a level of social follows: –– An initial move towards diversifying insurance products
into areas of insurance that have typically not been
covered before.
