CIRC Shanghai Bureau Partner with ZhongAn to Develop A Reinsurance Blockchain Platform
ZhongAn Technology, a subsidiary of Chinese online insurer ZhongAn, has applied the blockchain technology to the insurance industry. Recently, China Insurance Regulatory Commission (CIRC) Shanghai Bureau joins hands with ZhongAn Technology to develop a experimental platform of reinsurance based on blockchain technology.
The experimental blockchain reinsurance platform is an inter-company reinsurance transaction platform. The CIRC Shanghai Bureau leads the interagency partnership with ZhongAn Technology and a number of primary insurance institutions and reinsurance organizations to use blockchain technology as a new industrial solution.
In the daily business of reinsurance, transactions are not as frequent as banks or securities transactions, however, the demand for reliable data is increasing gradually. The blockchain solution provided by ZhongAn, includes data storage encryption, data transmission encryption and license, could ultimately provides a transparent and automated transaction process, which can be integrated into a unified multi-chain trading ecosystem.
The CIRC Shanghai Bureau stated that: “The purpose of building this experimental platform is to verify the feasibility of the blockchain usage in reinsurance business and the unique advantages blockchain technology brings in dealing with inter-company reinsurance transactions. The blockchain based reinsurance trading platform could create significant efficiencies in contract signings, reinsurance, bill exchange, claims payments and other transaction processes. All these processes can be integrated into a unified multi-chain trading ecosystem. Blockchain technology could help the insurance industry to achieve a balance between enhancing significant efficiency and protecting trade secrets. Blockchain has the potential to revolutionize underwriting, efforts by insurers to implement blockchain technology could create efficiency, veracity and avoid transaction disputes in the reinsurance purchasing and claims processes.”
Blockchain technology could lead to faster claims payments and cheaper coverage. However, applications in the insurance area is still in its infancy, the regulatory environment for blockchain based transactions is underdeveloped. Blockchain development requires insurers to share information and put more efforts in it.