Blockchain is of strategic interest to major insurance corporations, as it can verify assets accurately and prevent fraud. More importantly, it can help insurance firms in cutting down on the huge number of intermediaries. Thomson Thomas, CIO, HDFC Life, explains why he is bullish on the potential of the technology
How do you see the potential of Blockchain for your industry?
What can you do with Blockchain that cannot be done with traditional existing technologies? A good number of private life insurers in India have thriving partnerships with banks, NBFCs, brokers and aggregators. The traditional approaches to systems integration have evolved from batch files, portals and re-directions to web services. These modes of integration carry overheads of duplication of certain controls and reconciliation efforts. The demands of system performance lead to considerable investments in infrastructure, high capacity network links, and the associated tools for monitoring and management. The security and the smart-contract tenets of Blockchain provide a promising alternative to the traditional approaches of implementing B2B integrations.
Blockchain, at its very core, targets disintermediation. While the areas of applicability and the corresponding sensitivities may vary across the industries and the players therein, the distributed ledger technology and the benefits of its immutability pave way for participating organizations to instrument direct collaboration in common areas of interest, instead of relying on any intermediary.
Can you highlight some specific use cases where you see Blockchain being leveraged?
Blockchain is a bleeding edge technology, with only a few Indian banks completing successful pilots and planning broader adoption within their ecosystem. We see Blockchain being explored for detecting and reducing fraud and in driving operational efficiency at scale.
As a company, what are your initiatives around Blockchain and what are the intended benefits?
HDFC Life initiated the journey of continual transformation in FY 2012-2013. The critical investments made in CRM, SOA/BPM, portals, mobility, EDW and security have already been delivering business value and creating opportunities by strengthening existing distribution channels, fostering emerging channels, with unprecedented focus on customer experience, quality of service, and quality of business, and through overall process efficiency and control efficacy.
Blockchain is considered to be a natural fit to transform some of our traditional business integration solutions that are limited across the dimensions of time-to-market, security, reliability and economy of scale. The experimentation has already been initiated to validate the merits as per the stringent evaluation criteria for the slated business use cases and the results are awaited.
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