PwC: Blockchain could save reinsurance companies $10 billion in costs

Rage Comment : German insurance giant Allianz has used blockchain for catastrophe swap insurance. Studies have pointed out that although blockchain technology was first applied to financial industry-related research, the insurance industry will be the best application scenario for blockchain. Therefore, PwC recently released a related report, saying that blockchain can save the reinsurance industry $5 billion to $10 billion in costs, accounting for 15% to 20% of the entire industry's costs. Therefore, this is an industry with great disruptive potential, and only forward-looking companies can gain a pioneering position.

Translation: Annie_Xu

Reinsurance companies plan to build the largest blockchain application outside of the payment sector, with the potential to save $10 billion in costs, according to a new report from PricewaterhouseCoopers (PwC).

The report shows that blockchain has great potential to transform the reinsurance industry due to the large amount of data flow between clients, brokers, reinsurers and outsourced service providers.

PwC estimates that blockchain solutions could reduce costs for the reinsurance industry by 15% to 20%, or $5 billion to $10 billion, by streamlining multiple data entry and reconciliation processes.

The report shows that blockchain technology can improve the claims processing process; the original insurance company can also use specially designed applications to process contracts, notify the various insured parties, and process premium and commission payments, thereby transferring risks.

The report states that the benefits of blockchain in the reinsurance industry include eliminating duplication of work, supporting its entry into new markets, such as the catastrophe swaps market, and improving transparency.

Stephen O'Hearn

Stephen O'Hearn, Global Insurance Director at PwC, said:

“Blockchain technology is still a very new and uncertain area for the reinsurance industry; however, those who can quickly build, evaluate and improve applications will stand out.”

"As companies seek to reduce costs, they should focus on blockchain's potential to dramatically improve efficiency and accuracy."