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Sompo, Tokio Marine provide marine insurance via TradeWaltz blockchain

container ship marine trade

TradeWaltz is the Japanese blockchain platform for digital trade founded by NTT Data and major trade conglomerates such as Mitsubishi. Japan’s largest non life insurers, Tokio Marine & Nichido Fire and Sompo, have been shareholders since incorporation in 2020. However, they only started to use the platform for insurance last month when the TradeWaltz insurance offering went live.

Digitalization was the primary motivation for launching TradeWaltz and the accompanying time savings. Because blockchains are hard to tamper with, processes become more secure.

For example, bills of lading represent the title to the cargo in transit. Historically, the exporter would courier the document from the onboarding port to the destination, but that can be risky. Electronic bills of lading (eBL), which are cryptographically signed and sent over the network, help to enhance security. We believe Japan does not yet fully recognize these eBLs legally, but that is something that Tokio Marine has been pushing forward.

In order to provide cover, the insurer needs documentation such as the bills of lading, invoices and letters of credit used for financing. Sompo says it has developed an API that connects to TradeWaltz. This helps to automate the application process for insurance cover for marine cargo, as well as claims.

“We have been working on digitalizing our customers’ trade practices from an insurance perspective,” said Tetsunosuke Shintani of Tokio Marine & Nichido Fire. “By connecting this system with TradeWaltz, trade-related parties will be able to use a comprehensive digital environment. In the future, together with TradeWaltz, we will develop the infrastructure for the international distribution of insurance data.”

Blockchain insurance’s checkered history

Around 2018/19, insurance was seen as one of the killer apps for enterprise blockchain, but it didn’t quite work out that way. Today projects are more mature, so TradeWaltz has more than 50 paying clients and many more related organizations using its platform. And there is a little bit of a renaissance in blockchain insurance.

During that hype era in 2018, EY and Guardtime collaborated to develop the Insurwave blockchain solution with Maersk as the founding client. However, the companies subsequently sold Insurwave and it no longer uses blockchain.

Tokio Marine was also a backer of blockchain insurance platform B3i, which had a marine offering and shuttered last year.

On the flipside, startups such as Otonomi are using blockchain for parametric insurance for logistics – to cover cargo arrival delays.

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