Welcome to another exciting episode of Insureblocks! Today we are joined by Stan Nazarenko and Karl Stanley who discuss how blockchain can enable seamless data transfer in the insurance industry.

Stan Nazarenko is the CEO of Piprate which is an InsurTech data sharing platform. Piprate aims to provide companies in the insurance and reinsurance space with a way to share data that creates trust, accountability and transparency.

Karl Stanley is an AVP at Technology Ventures for Renaissance Re. Renaissance Re is a global reinsurer specializing in writing P&C business which has been in existence for 25 years.  Technology Ventures at Renaissance Re is a combination of a Corporate VC arm and an innovation department – the objective of this function is to keep an eye on emerging technology, provide advice to the VC arm on technology investment and develop internal technology strategy for both the short and long term.

 

Blockchain in two minutes

Our guests were asked the customary Insureblocks question to share their perspective on what blockchain is and perhaps, what it means for the insurance industry.

According to Karl, from a non-technical perspective, blockchain is a shared and tamper-proof data store. From a technical perspective, it is a decentralised shared ledger which relies on distributed computing and asymmetric cryptography (public-private key pairing.) Distributed computing is important since the ledger is shared by all parties and replicated across all nodes in the network and cryptography maintains the security of the system. Explaining further how cryptography secures the system, Karl stated that since blocks are hashed, a change in data stored in a block results in a change in the hash which indicates that tampering of data has taken place!

Stan chose to provide a less technical and more business-oriented definition of blockchain. He stated that blockchain is a technology that allows a network of participants to agree on a single, shared and consistent state of the world. It also allows participants to update the state.

 

Some insight into Piprate

Insurance professionals are always looking for the most attractive risk. Precise and trusted data is required to understand risk. Today’s data sharing involves a combination of excel spreadsheets, emails, file shares etc. These methods of data sharing are not secure, not compliance friendly and pose the grave threat of cyber risk.

Piprate permits seamless data sharing by using data wallets -  a list of all data possessed by a member of the network. The goal is to help everyone along insurance value chain to get most comprehensive risk representation – thereby bringing risk closer to capital, permitting better pricing and facilitating precision underwriting.

 

Why did Piprate choose blockchain?

Stan was posed the question on do they really need a blockchain based system for the effective exchange of data between the parties along the value chain. In his view the challenge of using  APIs either to connect insurance players along the value chain or via centralized institutions is three fold:

* Who will hold the data? Will data be held by the firms’ respective authors? Will it be via a centralized party? If these firms get hacked, acquired, or go out of business will the data become inaccessible?