Insurwave, the marine blockchain platform launched by EY and Guardtime in May 2018, is already starting to bring “material” cost savings to its users, according to its chief commercial officer Stefan Schrijnen.
In an event hosted jointly by EY and its blockchain offshoot – which is now its own trading entity – Schrijnen spoke of the significant financial, “real-world” benefits the platform is already providing for its clients.
“A big one is around the cost of servicing, in terms of the cost of administering insurance for risk owners, brokers and insurers. This relates to the cost of several processes, including warzone declarations and calculating premium adjustments based on changes to dynamic risk data,” he explained.
“Right now, and for the last year, our platform has been automating those things and we have measured a 25 percent cost reduction relative to the pre-Insurwave costs… which were manual and took months. That is a real saving.”
Schrinjen claimed the platform delivers a more reliable, trustworthy view of risk owners’ exposures, which they can share with their underwriter to provide clarity on the risk that they’re actually underwriting.
“Something we’re managing in terms of the pre-Insurwave data package versus the post-Insurwave data package is the rate that our ship owners are able to achieve in the market, and there’s real money in that today,” he said.
Schrijnen identified breach notification as the most significant business benefit for the circa 2,000 vessels Insurwave now has on board. He estimated that risk owners not on the platform receive notifications for only a quarter of breaches, pointing towards an environment of “extreme under-reporting.”
In terms of cost-savings, Schrinjen calculated that for every dollar of premium on the marine blockchain platform, Insurwave creates a cost benefit of 5 cents.
“We’ve got about $75mn dollars on the platform and we’re delivering about $4mn of cash benefit per year,” he said.
Looking forward, Insurwave said the quality of the data processing it offers to its customers will be a key metric for efficiency.
Currently, he claimed, the blockchain’s circa 2,000 vessels receive 50 percent more data points than their non-Insurwave initiated counterparts but Schrinjen offered the ballpark target of producing 200 percent more data points for Insurwave users in the foreseeable future.
Part of the challenge, he added, will be achieving greater collaboration across the industry – even between competitors.