New Zealand’s largest bank ANZ, with tech partner IBM, has successfully developed a blockchain solution that will serve as a ‘single source of truth’ for insurance companies and brokers.
The Australia and New Zealand Banking Group (ANZ) has concluded a successful proof of concept using blockchain technology to make data transfers more efficient with faster, more transparent payment reconciliation between brokers and insurers in the insurance industry.
The solution, developed alongside major New Zealand insurance provider Suncorp, set out to improve on the existing inefficiencies of a complicated reconciliation process wherein an individual’s payments toward an insurance company are made through a broker who sold the insurance product.
“Reconciling policy information and premium payments made by a broker to an insurer on behalf of customers is a slow and painful process,” explains ANZ executive Paul Goodwin.
Using the Hyperledger Fabric, IBM’s enterprise blockchain software, the proof-of-concept successfully demonstrated the use of decentralized technology in three areas of focus, according to a white paper released by the bank.
The first saw the efficient transfer of data in the entire process from quoting to issuing an insurance policy while removing the need for authorizing and reconciliations at various stages.
Secondly, bulk payments were automatically allocated from brokers to insurers down to the level of individual policies.
Thirdly, the inefficient process of manual reporting was completely removed with automated reporting to help with insights.
IBM New Zealand managing director Mike Smith added:
“The result is an interoperable network that could not only decrease policy costs and improve customer service, but also build a foundation for the introduction of other transformative technologies, such as artificial intelligence.”
‘The experience of running a distributed ledger solution within New Zealand considering new tools for our customers’ problems has given us great insight into the process,’ ANZ said in its white paper.
Further, the blockchain solution also integrated an automated payment process, provided by ANZ, to enable straightforward bulk payments that are immutably recorded and tracked on the ledger. The first-of-its-kind proof-of-concept solution in New Zealand saw the core blockchain and product developed in-house in New Zealand, ANZ confirmed.
Notably, it added:
With this [blockchain solution], a future ecosystem with multiple insurers and multiple brokers is a viable outcome.