Insurtech Arbol and The Institutes RiskStream Collaborative have announced that the dRe insurance solution had gone live on RiskStream’s blockchain platform. dRe uses smart contracts for reinsurance calculations on chain.
Arbol provides parametric insurance, which automatically pays out claims based on weather data and AI. One of its subsidiaries is a Lloyd’s coverholder, and it recently launched parametric offerings for the U.S. market underwritten by Beazley.
How dRe works
At launch the target for dRe is the automation of claims for severe weather events. When there’s a major storm, dClimate, a decentralized weather monitoring system spun off from Arbol, will register the event. Using the Chainlink blockchain oracle network, that data is fed into the smart contracts.
The whole point of parametric insurance is to avoid a manual claims process. Based on the insurance wind speed, the smart contract will start a claim and the system automates the loss calculations and notifications.
“By leveraging blockchain technology and smart contracts, we are fundamentally reshaping the landscape of parametric (re)insurance, ” said Sid Jha, Founder and CEO of Arbol. “It transforms how we manage severe storm catastrophe transactions by providing rapid, auditable, and reliable payouts.”
The solution uses RiskStream’s Canopy platform and technology from Kaleido.
We believe this is the second solution to go live on Canopy following the launch of Rapid X, its First Notice of Loss (FNOL) solution. RiskStream has demonstrated remarkable endurance in the face of numerous obstacles.
Five years ago, it looked like the insurance sector would be an early mover embracing blockchain. Given the extensive data sharing between insurance organizations, it seemed a logical fit. But that hasn’t worked out. Yet.
RiskStream was one of the first initiatives alongside B3i, the latter receiving backing from a dozen reinsurance firms. B3i shuttered last year. Another early production insurance uses case, the Maesk marine insurance platform Insurwave, was sold by Guardtime and EY and subsequently ditched blockchain.
That’s not to say its all doom and gloom. For example, Allianz has successfully deployed a solution for cross border auto claims. And several insurtechs are embracing blockchain, including using DeFi for capital as an alternative to Lloyd’s. Ontomi is another insurtech deploying parametric insurance using blockchain for cargo insurance.
Source: Ledger Insights
