Decentralized insurance platform Etherisc has announced support for the first blockchain-enabled insurance product which will help protect property and earnings of small businesses and low-income households from catastrophic weather events in Puerto Rico.

The hurricane insurance policy on Etherisc’s blockchain platform will remove the need to deal with traditional insurance companies. It will enable one of the first real-world use cases of decentralized insurance and demonstrates how Etherisc-based insurance templates can be customized to manage and mitigate risks for communities around the world.

Etherisc’s decentralized insurance protocol uses a library of automated smart contracts to record transactions in a secure and transparent manner. It eliminates the need for middleman, thereby reducing the cost of household and small business policies. In addition, the protocol automates premium calculations and claims payouts so policies are faster and cheaper than traditional insurance.

“When we were approached by two developers in the country to create a customized policy that would meet the needs of Puerto Rican residents, we saw an incredible opportunity to help the islanders and showcase just what Etherisc and decentralized insurance can do,” Etherisc Co-Founder Stephan Karpischek said. “By using Etherisc-provided common infrastructure, open-source product templates, and insurance license-as-a-service, they are able to build a tailored policy for Puerto Ricans that was both affordable and accessible, without the huge premiums, delays, and frustrations of traditional insurance. This is exactly what we envisioned for Etherisc – an open protocol for entrepreneurs to collectively build and bring to market truly innovative insurance products.”

In its official release, Etherisc said that the hurricane insurance is also designed as a “parametric insurance,” meaning it uses a set of predetermined weather parameters to trigger a fixed payout immediately. This type of policy also lowers premium costs, helping to make insurance more affordable for low-income families and small businesses.