Sunday, May 20, 2018

Delaware Business Insurance Update from CNC Insurance Associates, "Can The Technology Behind BitCoin be the Answer to Stopping Fraudulent Claims?" 5-20-18

McKinsey and Company recently reported that 5-10% of all insurance claims are fraudulent. This may not seem like a lot but when you add in the costs then you realize it is a big deal. Those costs are estimated at $40 Billion a year !!  Now that gets your attention. ( This from the US and FBI as reported in Rough Notes magazine, May 2018). So the question is can technology stop the fraud?  Blockchain may just be the ticket to put a stop to the fraudsters.
Blockchain is the technology that powers bitcoin. Its use as a tool is spreading into various other applications. The insurance industry is no exception. Because of its recorded and public ledger, insurance companies see it as a way to reduce the frequency and severity of bogus claims. The transparency of blockchain will give claim adjusters an easier way to validate true claims and recognize the fake ones.
The technology behind blockchain is for another blog post. But you can surely bet that insurance companies will be sinking their teeth into making it part of their claims processing. Until next time be careful out there and know your risks.

G. Kevin Nemith- President CNC Insurance Associates- Member of the Hilb Group.
1-877-262-3276 toll free.