At last week’s InsureTech Connect 2018 conference, I dropped into a session on the future of insurance technology and caught an interesting presentation on how blockchain was going to change the claim process. And by change, I mean eliminate. Zia Zaman, CEO of LumenLab, described a smart contract enabled by blockchain technology. Instead of a claims manager deciding what was or was not covered by an insurance policy, Zaman sees a blockchain-enabled smart contract that automatically kicks in once the terms of the contract are satisfied.
It is an interesting concept given the complexities of contract law in modern society. Can something as important as a legal contract, like an insurance policy, be left to a decentralized tool like the blockchain? Can a smart contract really be ‘smart’ enough to deal with all the contingencies of real-life scenarios? The premise of a smart contract is that the author of the contract can account for all the nuances, all of the interpretations and details that need to be accounted for prior to the event actually happening. Lawmakers try to do the same thing when they write a law. They hope they have anticipated all the ways a law, once written, will be applied and interpreted.
The reality, though, is that once a contract is written it immediately becomes open to interpretation. The courts are full of interpreters. As long as there are people willing to winnow out a unique position, read the tea-leaves, divine the intentions, then ‘smart’ contracts will likely be only as smart as those interpreting them. The level of omniscience necessary to write a workable blockchain enabled smart contract is, to put it mildly, unlikely given that real humans like lawyers, judges and juries, continue to explore new nuances that change the ways in which a contract can be interpreted.
Maybe someday it will be “computer code versus computer code” or “algorithm versus algorithm” and at that point some level of certainty of outcome can be readily calculated. However, until that time, I believe, a human claim with a human lawyer is going to need a human claims manager with human experience to sort out all the messy human details.
But, keep in mind: there are simpler ways to improve the claims process. At SPLICE, we are true believers that the claims experience is a moment of truth for policyholders, and that a superior customer experience can make the difference between a raving fan and a customer-at-risk. Our customer notifications for FNOL, Adjuster Appointment Reminders, Claim Closure, Drone Alerts, and Pre-/Post-CAT are a cost effective and personalized solution that can save Insurers money and reduce time to claim closure. I’d love to tell you more.
Looking for ways to improve communications and customer experience throughout the Policyholder journey? SPLICE can help! Contact us at 1-855-777-5423 or click here.