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AXA Explores Ethereum Blockchain Technology For Flight Delay Insurance

by on September 13, 2017
 

The number of use cases for blockchain technology is virtually limitless. It is good to see some use cases which are not directly related to banks or their regular services. AXA, the French insurance giant, is exploring flight delay insurance options with DLT. The goal is to use the public Ethereum blockchain for this purpose rather than create another private solution. The company aims to store and process payouts through this ledger, which will have some interesting consequences.

Insurance companies stand to gain a lot from exploring public blockchains. Rather than using private DLTs, a public solution makes more sense. Especially when considering how the insurance sector direly needs more transparency these days. Axa’s Fizzy project aims to do exactly that, but with a twist. This new flight delay insurance project is considered to be a “smart” tool. Anyone can insure their trips and if they are delayed by 2 hours or more, they receive compensation.

AXA Embraces Ethereum Blockchain Technology

As some people would expect, Fizzy makes use of smart contracts.Axa has been readily exploring this technology through the public Ethereum blockchain. It is the only proper solution providing such functionality right now. It is possible we will see Bitcoin smart contracts in the future as well. Having a self-executing code for this type of insurance can prove to be invaluable for AXA and any other company exploring similar options.

AXA’s Jean-Baptiste Mounier explains the company’s decision as follows:

“The smart contract is the party that decides whether or not we should indemnify the policyholder and triggers a payment request to our system. The use of a smart contract to trigger claims will add trust in the insurer / policyholder relationship. Building customer-oriented offers is our definite goal at AXA. By removing insurance exclusions and using an Ethereum smart contract to trigger indemnifications, we increase the level of trust our customers can have with AXA.”

It will be interesting to see how this Fizzy project plays out in the future. It is evident the insurance sector and blockchain technology provide a potent mix waiting to be explored. AXA is actively exploring other use cases for this public DLT as well. It is possible the payouts themselves may eventually be paid in Ether, rather than fiat currency. Whether or not customers will enjoy that change, remains to be seen. Cryptocurrency is still a very niche market. Most regular consumers aren’t too bothered by it, that much is evident.

Header image courtesy of Shutterstock

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