Japanese property insurance company Sompo conducts blockchain experiment for disaster insurance

Rage Review : Yesterday, Japanese property insurance company Sompo Japan announced that it had cooperated with Soramitsu to develop a derivative system based on blockchain technology, creating services that enable real-time sharing of data, such as contract details on the blockchain, so as to correctly and quickly execute every step in the insurance process, from derivative product risk integration management to deciding whether to pay claims, and executing procedures to pay compensation. Sompo is not the only company to do this. Last year, French insurance company Allianz announced the development of a prototype system for trading catastrophe bonds; last week, blockchain startup Symbiont provided a demonstration opportunity for a group of insurance companies and financial companies in New York.

Translation: Nicole

One of Japan’s largest property and casualty insurance companies is collaborating on a prototype blockchain system for insurance derivatives.

Japanese insurer Sompo Japan Holdings announced yesterday that it is working with Soramitsu Corp. to develop a method for buying and trading insurance policies against natural disasters and other catastrophic events.

The company said in a statement:

“The derivative system (experimental name) of blockchain technology jointly developed by Sompo Holdings and Soramitsu aims to create services that enable real-time sharing of data such as contract details on the blockchain, thereby correctly and quickly executing every step in the insurance process, from derivative product risk aggregation management to deciding whether to pay claims and executing procedures to pay compensation.”

Sompo isn’t the only company exploring whether blockchain technology can be used to create a financial bridge to protect against catastrophic events.

Last year, French insurer Allianz announced the development of a prototype system for trading catastrophe bonds, noting at the time that using a blockchain-based system had the potential to improve the “reliability, control and speed” of these transactions.

Additionally, last week, blockchain startup Symbiont hosted a group of insurance and financial firms in New York, where they demonstrated a new system for trading catastrophe swaps. (Details of the demonstration can be viewed here.)

Sompo said the experiment with Soramitsu has the potential to expand beyond a disaster insurance platform.

We can look forward to these new products, but Sompo says all future developments will be geared toward “ensuring consumer safety and health.”