Blockchain: Breaking Through the Trough of Disillusionment
This article was originally published in the Spring 2022 edition of Insights: A Professional Journal by the CPCU Society and is shared with permission from The Institutes CPCU Society. All rights reserved. www.CPCUSociety.org.
Blockchain technology is beginning to modify insurance operations, helping the industry
overcome some of its challenges. Use of various blockchain technologies within business,
including the insurance industry, varies by its inception. Cryptocurrency, like bitcoin, has
been around for more than a decade but is just now starting to be held by institutions,
including insurers, as a hedge against inflation. Enterprise blockchain, with which a private
permissioned blockchain network is leveraged to share data and improve multiparty
business processes, launched a little over half a decade ago and is just now showing signs
of moving toward production within insurance. Newer uses of blockchain technology, such
as decentralized finance, nonfungible tokens, and decentralized autonomous organizations
are on the near-term horizon for the industry. Each of these blockchain technologies will
play a role in redefining the insurance industry in years to come.