The American Association of Insurance Services (AAIS) has announced the formation of three working groups to develop regulatory reporting applications for the openIDL blockchain platform. The working groups will focus on auto, homeowners and flood insurance.
AAIS is a non-profit advisory organization serving the Property and Casualty insurance industry. It collates data from the insurance sector and analyzes it to provide loss reports and rating information to carriers and state regulators.
The open Insurance Data Link (openIDL) system built on Hyperledger Fabric, is a blockchain platform developed for the regulatory reporting process. For personal property-casualty insurance products in the U.S, about half of the states require insurers to file rates and to receive prior approval before rate or policy form filings go into effect. The National Association of Insurance Commissioners (NAIC) has a Model Rating law which also requires insurers to report data to statistical agents such as the AAIS.
The platform aims to improve the efficiency of the regulatory reporting process, invariably reducing costs. Using openIDL, regulatory bodies can easily view data for governance. Blockchain enables insurance companies to view market data without revealing the identity of competitors. The goal is to improve the insurance sector by bringing together all the stakeholders in the industry.
“We see great potential in the open architecture upon which openIDL is built, and we’re excited about the enthusiasm and collaboration we are seeing among leading insurance carriers across the industry,” said AAIS CEO Ed Kelly.
The three working group were set up after Design Thinking sessions with input from the industry and regulators. AAIS recently held a fifth Design Thinking session, which was attended by representatives from State Farm, Travelers, The Hartford and other market participants.
“Through Design Thinking, we’re seeing how others in the industry can build on our open blockchain platform to realize even greater value across the entire risk and insurance ecosystem,” said Truman Esmond, AAIS VP of Solutions and Partnerships.