As blockchain makes its way into the insurance sector to automate processes for paying claims and other administrative functions, Richard Levin, partner and chair of the FinTech and regulation practice at Nelson Mullins, told Risk & Insurance in an interview that the technology may fundamentally change how the industry conducts business.

“Many firms in the financial services and insurance industries believe blockchain technology can be adapted for use in traditional transactions in a way that has the potential to redefine transactions and administrative functions,” he said. 

According to Levin, a group of member companies known as the B3i Consortium came together to test the development and use of blockchain technology in the insurance industry, with an initial focus on property casualty insurance and to see how insurers can use blockchain for catastrophe excess of loss coverage.

“The B3i initiative was spun off into a separate entity known as the B3i Consortium. The consortium incorporated as B3i Services AG in 2018 and is 100% owned by 21 insurers,” he said.