On May 30, 2018, Hunton Andrews Kurth LLP launched its Blockchain Legal Resource, a blog featuring discussion and analysis of the latest trends and developments in blockchain (distributed ledger) technology.
Insurance giant Allianz Global Corporate & Specialty S.E. announced yesterday that it has launched a blockchain prototype for a global captive insurance program. The project focuses on professional indemnity and property insurance for a customer with a captive insurance program with local subsidiaries in the U.S., China and Switzerland. Captive programs are complex programs used frequently by multinational organizations to self-insure their risks. These organizations create their own self-insurance programs, or ‘captives,’ which aggregate assets or insurance exposures from their global operations. The programs collect premiums from each operating unit much like an ordinary insurer. The captive entity likewise pays out claims as they arise. Allianz administers the captive insurer as a “fronting insurer,” using the insurer’s diverse multi-national network to ensure global reach and compliance. Blockchain technology automatically connects all parties involved in the insurance program by using its distributed ledger technology, which is shared among all program participants and can record transactions and data entries. Updates and changes to the data are shared in real-time across all users. This creates a much faster, transparent, secure and efficient means of distributing information, conducting business processing and recording transactions across multiple parties.