The commencement of a project to develop a blockchain-based insurance prototype has been announced by the open-source, decentralised insurance protocol and ecosystem Etherisc, in partnership with the Blockchain Competence Centre Mittweida (BCCM) at Mittweida University of Applied Sciences.
The aim of this joint project is to provide refined alternatives to traditional insurance policies by leveraging decentralised autonomous organisations (DAOs) with artificial intelligence (AI) and machine learning (ML). Ultimately, this combination seeks to streamline and automate the process of insurance assessment and payment.
Both parties involved in the project aim to create a fair and sustainable model that can significantly reduce premiums and distribute profits regionally for charitable purposes.
In addition, the use of blockchain technology will ensure transparency and fraud protection, while also providing a scalable solution that exists independent of national borders. End-customers seeking to avail of the solution can also participate in its development at the same time, helping to determine essential features as part of the community ethos of the project.
Commenting on the announcement, Christoph Mussenbrock, Co-founder of Protocol and Architecture at Etherisc, said, “We’re excited to be working with some of the brightest minds in the academic blockchain space. Traditional insurance models are characterised by cumbersome claims and payout processes, low levels of transparency, conflicts of interest, and low payout amounts. Through this enterprise and academic partnership, we seek to overcome these challenges through the development of an entirely new blockchain insurance platform. This harbours the immense potential for consumers in the region and beyond to benefit from truly innovative insurance products and policies.”
Etherisc and Mittweida University of Applied Sciences are collaborating on an initial proof-of-concept and pilot test, followed by the development of a final prototype for a fully-fledged decentralised insurance solution.
DAOs, AI, and machine learning will reportedly all be incorporated into the final prototype, and it’s forecast that the use of these technologies and frameworks will reduce administrative costs, enable scalability for products, and provide transparency for consumers.
The use of a DAO enables direct customer participation in product design and control decisions. In conjunction with this, the project is also set to include an AI component that will determine the risk of an occurring claim, aiding in better-designed policies and faster payout processes.
Professor Andreas Ittner, Head of BCCM at Mittweida University of Applied Sciences, commented, “Etherisc has an inspirational vision to make insurance fair and accessible through a decentralised open-source insurance protocol and we are excited to bring our expertise to bear in the development of a joint product. Together with Etherisc, we are exploring methods to incorporate the latest technological developments and harness the potential of blockchain technology to create meaningful insurance solutions for the benefit of all consumers.”