Five leading global insurers and reinsurers have teamed up to launch a blockchain initiative that aims to explore the potential of this innovative technology.

Called the ‘Blockchain Insurance Industry Initiative B3i’, the initiative has been launched by Aegon, Allianz, Munich Re, Swiss Re and Zurich. It aims to explore the potential of distributed ledger technologies to better serve clients through faster, more convenient and secure services.

The initiative will allow insurers and reinsurers to get a better insight into the applicability of the blockchain technology in the insurance market. In addition, it offers a platform to exchange insights regarding blockchain and potentially other technologies, use case experiments and research information.

“Aegon, Allianz, Munich Re, Swiss Re and Zurich have agreed to cooperate for a pilot project, using anonymized transaction information and anonymized quantitative data, in order to achieve a proof-of-concept for inter-group retrocessions by the use of the Blockchain technology”, the announcement reads.

With this feasibility study, the founding members aim to explore whether blockchain technology can be used to develop standards and processes for industry-wide usage and to catalyze efficiency gains in the insurance industry. The initiative aims to facilitate the transition from individual company use cases to viable solutions across the entire insurance value chain.

“If Blockchain technology proves viable, it could well streamline paper work and reconciliations for (re-) insurance contracts and accelerate information and money flows, while greatly improving auditability”, it added.

The initiative is open to other insurers and reinsurers and its ultimate ambition is to assess how blockchain technology can be established as a viable tool for the insurance industry in general and for insurance clients in particular.

“Blockchain technology shows most of its potential only if it’s applied in a network of peers. Therefore we see a huge benefit for the insurance industry in doing this together in the Blockchain Insurance Industry Initiative B3i. With B3i we are in the position to explore and shape the future use of Blockchain and to set the necessary standards for a true digitalization of insurance”, Harald Rosenberger, Head of Innovation at Munich Re, said.