For this week’s episode we had the pleasure to hear about the exciting blockchain work IBM does in the insurance industry and beyond. We very pleased to have Craig Bedell, Global Insurance Industry Executive, and Annap Derebail, Executive Architect Financial Services Sector from IBM, take us through IBM’s journey with Hyperledger Fabric and some interesting blockchain case studies.

 

Blockchain in 2 minutes

Annap

Annap chose to explain what is blockchain from an insurance perspective. The insurance industry operates within a network that involves brokers, service providers, regulators, advisory services, other insurance carries and reinsurers. They transact business across this network by exchanging assets that typically historically have been recorded in ledgers or systems of record by each party involved in these transactions.

As they compete with each other they don’t necessarily trust each other. The effect of this lack of trust is that when ledger’s mismatch for whatever reason, either due to error or incomplete updates, businesses would spend considerable time and resources to resolving these disputes or reconciling records.

Blockchain fundamentally brings a shared replicable ledger that records who owns what within a business network so that there are no disputes and records don’t have to be reconciled.

 

Craig

For Craig, blockchain is a technical platform for conducting transactions on a shared permanent ledger that records every aspect of every transaction between all associated parties. Don Tapscott, author of the blockchain revolution, refers to blockchain as being the second coming of the internet, the first internet being the internet of information and this second internet, blockchain, being the internet of value.

 

Hyperledger

Hyperledger was founded back in 2015 when a number of companies that were working on blockchain realised that they could achieve more by working together rather than separately. They came together with the aim of pooling resources in order to create open-source blockchain technology for anyone to use. The members put the governance under the foundation or guardianship of the Linux Foundation. The organisation now has over 230 member organisations from a wide variety of industries.

 

Three key principles, why insurers should consider Hyperledger

According to IBM, there are three key principles, why insurance companies should consider Hyperledger:

* Open source: the code is written in a reliable manner, has no vendor lock-in, resulting in high quality solutions

* Open governance: all technical decisions carried out within Hyperledger are made by a group of community elected developers.

* Open community: An open community concept which establishes enterprise friendly consistent handling of IP and this is done by adopting the Apache 2.0 license and the Creative Commons attribution 4.0 license for content.

Beyond these three key principles there are a set of design principles for enterprises: modularity, security, interoperability, availability of open APIs that enable ease of dealing with these sorts of Hyperledger blockchain frameworks.

 

IBM’s involvement in Hyperledger – Fabric

Hyperledger Fabric has a modular based platform for building distributed ledger so...