For life and health insurance agents and agency owners, this transformation will present technological challenges.The key will be to realize the implications of these technologies and the benefits they will bring to both customers and agents.The question is, how will contracts be able to transform insurance?

The insurance industryis on the cusp of monumental change driven by the integration of blockchain technology

A brief overview of the participants

Smart contractsare self-enforcing agreements based on blockchain technology.They are likely to revolutionize the way agents and insurance companies work and interact with their customers, offering improved data interoperability, automated administrative processes, reliable fraud detection and more customer-centric processes;
The blockchainis a secure, digital ledger that records transactions across a network of computers.It is designed so that once something is recorded, it cannot be changed, creating a permanent and transparent history of events.This reliability is what makes smart contracts possible.Because everyone on the network sees the same version of the truth, insurers and insureds can automate claims, trigger payments and enforce contract terms without the need to rely on verification or intermediaries.Blockchain lays the foundations for smart contracts to function with trust, speed and accuracy.

In this article, we will not attempt to unravel the many mysteries of blockchain technology.Instead, let's look at some of the amazing benefits they will bring us.

The challenge: Bringing solutions to the real world

Even those new to insurance are familiar with the technological hurdles facing the industry.On our side are high administrative costs and outdated technologies.On the customer side, there are growing expectations for personalized services and more competitive prices.The clash between these obstacles is particularly acute for life and health insurance agents and agency owners, who must balance delivering value to clients with maintaining a profitable operation.

Deloitte research shows how these new capabilities can help agents and agency owners create new business opportunities.Here's what they found and why these findings are valuable to agents.

Blockchain and improved data interoperability

One of the key benefits of blockchain technology in the insurance sector is its ability to improve data interoperability.Blockchain can facilitate the creation of comprehensive, interoperable health records accessible to all parties, including insurers, health care providers, and insured individuals.

This improved data sharing and trust can lead to more accurate insurance management, as insurers will have a complete and more reliable picture of a customer's health status.For life insurance agents, this means being able to offer more personalized policies and better customer advice, ultimately improving the customer experience.

Automated administrative processes

Smart contracts are like digital agreements that execute themselves when certain conditions are met.They can automate many administrative tasks, from gathering important information to processing claims.For example, when an insured submits a claim, the smart contract can automatically verify its validity and process the payment without any human intervention.This not only speeds up the processing process, but also reduces errors and delays, allowing you to spend less time on paperwork and more time building strong relationships with your customers.

Fraud prevention

Fraud continues to be part of our business, costing companies billions of dollars each year.Smart contracts combined with decentralized blockchain protocols can help detect and prevent fraudulent activities.By creating an immutable and transparent ledger of all transactions, it will ensure that claims and applications are genuine and have not been tampered with.

For life insurance agents, this means a more secure and reliable business environment where the risk of financial loss due to fraud is greatly reduced.

Improved accuracy of supplier directory

Maintaining an accurate and up-to-date provider directory is critical to ensuring insureds have access to the right health care services.However, traditional methods of updating directories can be slow and error-prone.

Blockchain technologies can enable the creation of unique, easily and quickly updated supplier directories.This ensures that policyholders always have access to the most up-to-date information, thereby improving their overall experience and satisfaction.

Customer-centric application processes

The process of applying for „Life“it can be intrusive and off-putting to potential customers.By using blockchain technology to create a more comprehensive and accessible set of medical records, the application process can become more customer-centric.Insureds can easily share their health data with insurers, reducing the need for extensive medical examinations and questionnaires.This not only makes the process more convenient, but also helps build trust between the insurer and the insured.

Dynamic relationship between insurer and client

Blockchain technologies can also facilitate the integration of well-being behaviors into the insurer-customer dynamic.

Electronic health records stored on a blockchain can track a customer's health activities, such as regular exercise, healthy eating, and routine medical checkups.Insurers can use this data to offer more interactive and personalized policies, including discounts for maintaining a healthy lifestyle.

For life insurance agents, this means providing greater value to customers and potentially increasing policy retention rates.

Pilot projects in the real world

Several insurance companies in segments outside of health or life insurance have already started pilot projects for innovative contractuals

decisions.For example, parametric policies pay out based on predetermined events rather than the actual loss.These policies can be useful in situations where the loss can be easily quantified, such as natural disasters or flight delays.When the predetermined event occurs, the smart contract automatically processes the claim and pays out the payment, ensuring a seamless and efficient experience for the insured.

Smart contracts and automated workflow

Some insurers are using smart contracts to automate the entire claims process, from submission to payment.This not only speeds up the process but also eases the administrative burden for both the insurer and the policyholder.For life insurance agents, this means being able to offer their clients a more reliable and efficient service, which can be a significant differentiator in a competitive market.

For example, Avaneer Health launched a decentralized network and platform to transform healthcare administration.This platform connects payers, providers and innovators to share real-time data, streamline processes, reduce costs and improve outcomes.It enables secure and controlled data sharing, maintaining an immutable audit trail to improve data security and privacy.The platform's features, such as secure data sharing and an immutable audit trail, are consistent with the benefits of blockchain and smart contracts, suggesting potential compatibility or use of these technologies.Expected benefits include streamlined revenue cycles, lower costs, stronger data security and improved patient experience.

The introduction of smart contracts and blockchain technologies has the potential to transform the insurance industry by improving operational efficiency, enhancing the customer experience and creating new business models.

What can you do now?

1. Start with the insurers you trust.Ask your carrier representatives or marketing organization contacts if they are exploring smart contracts and other new opportunities.Some are quietly piloting features that could directly affect the way you submit applications or process claims.Showing early interest can give you access to upcoming tools, or at least a seat at the table when those tools are released.

2. Start planning the digitization of the processes you currently perform manually.Before implementing smart contracts, your business needs to think like a system.Start by identifying one part of your workflow that is still done on paper, in spreadsheets, or through repetitive follow-up actions.

Collecting health information or customer signatures;
Insurance status tracking;
Claim tracking or service.

Ask yourself: Can this be automated or standardized?Then check out the lightweight tools in these categories:

Platforms for electronic signature of documents;
Customer portals for sharing confidential information;
Workflow or task automation tools that reduce follow-up.

These may not be 'smart contracts', but they push your business towards efficiency and automation.

Continuation

3. Invest in technologies that build a smart contract-ready foundation.If your customer relationship management system is just a contact list, you're missing out on valuable opportunities.Leading agencies use their CRM (Customer Relationship Management) systems to:

Track customer behavior and preferences;
Automatically schedule contacts based on life events;
Register the service activity and subsequent actions in real time;
Sync with marketing tools or offer systems.

This kind of structure reflects what smart contracts will one day need to function.The goal is not perfection.The goal is progress.A modern CRM system, a document management platform, or a simple application programming interface can save you time now as you prepare your business for greater innovation in the future.

4. Build a relationship with someone who understands both technology and insurance.You probably don't need to hire a full-time CTO, but you do need someone who can help you discover new tools and evaluate them for suitability.This could be an insurance technology consultant, an innovation-driven supplier, or even someone from your FMO (Field Marketing Organization).As smart contracts grow in popularity, you'll need a reliable guide to help you deploy the right tools at the right time.

Now is the time for life and health insurance agents and agency owners to position themselves at the forefront of this technology revolution.Those who adapt and innovate will be best prepared to succeed in the new environment.

How could smart contracts transform insurance?

Download the app

Insurance Inquiry

Download the app

Insurance Inquiry