CAPTIVE INSIGHT
complicated by DAO’s (decentralised
autonomous organisations) providing legal
difficulties when determining liability since
they are, by definition, stateless and lacking
corporate structure.
To date there are few viable options for
insuring the potentially significant losses
resulting from these breeches in the
traditional insurance market. This has led
many of those affected, from businesses
accepting transactions in Bitcoin to crypto
currency exchanges, to explore the benefits
of captives as a viable alternative to
what can appear to be an unwelcoming
commercial market.
In addition we are seeing a number of
insurance related examples of companies
developing distributed ledger technology
(DLT) in the search for the more costeffective
business model their customers
are demanding, with ‘real-time’ efficiencies
and the profits they hope will accompany
such Proofs of Concept (POC) once brought
to market. From Maersk and XL Catlin’s
collaboration on a blockchain based
marine insurance platform to the news
that Allianz is testing the introduction of its
own cryptocurrency to assist with reducing
foreign exchange risks.
Blockchain in its current incarnation is
still a cumbersome database and has
yet to reveal proof of its transformative
abilities – although developments such as
Ethereum’s proposed Caspar protocol and
blockchain sharding reinforce that we are
still in the early stages of a new technology
which is changing rapidly as it understands,
and then reacts to, consequences as they
become apparent.
However blockchain, DLT and crypto
currencies are not the only forms of oftnamed
‘disruptive’ technologies impacting
the insurance market. Other emerging
technologies range from the Internet of
Things (IoT) automating the process of claim
settlements, to drones being used to assess
catastrophe claims long before human
teams are able to gain access. From AI to
bots, the insurance industry is embracing
and experimenting with the latest advances
in transformative ways.
When using the portmanteaus InsurTech
or FinTech there are two entities for
which Marsh’s Captive Solutions Group
in Cayman act as managers which spring
to mind as businesses which have chosen
to apply current technology to traditional
products. According to Client Services
Leader Kieran O’Mahony the result is a
strong foundation of tested insurance
principles delivered more effectively and
providing a better end experience for the
consumer. Kieran defines InsureTech
as the application of technology
to traditional insurance
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