Aon, Guy Carpenter partner on blockchain initiative to streamline reinsurance placement

Brokers Aon and Guy Carpenter have teamed up with The Institutes RiskStream Collaborative to streamline the reinsurance placement process using distributed ledger technology (DLT).

The organisations, along with industry partners including RenaissanceRe and Everest Re, have successfully tested a proof of concept to digitally and securely distribute submissions and receive quotes using blockchain and DLT technology.

The next phase intents to digitise the reinsurance placement process with the overall goal of streamlining interactions within the reinsurance marketplace by creating secure digital methods and processes for cedants, brokers and reinsurers to manage treaties.

The organisations have called for member carriers, brokers and reinsurers to come forward and contribute in the next phase of its development.

The project is built on RiskStream Collaborative’s Canopy framework, using ACORD data standards.

“There has been tremendous hype around blockchain in our industry, but few results to date," said Bob Olson, CIO of Aon’s Reinsurance Solutions business. "This is a very practical use case perfectly suited to a blockchain; multiple parties adding data, building upon the last until an agreed contract is formed through consensus. This shared single version of the truth brings immediate efficiency to the process while laying the foundation for further smart contract automation on downstream processes.”

John Crichton, CIO of Guy Carpenter, added: “This project is an important first step in the path to improving transactional efficiency and creating value for our clients through blockchain. We believe an open platform that is supported by industry stakeholders will maximize adoption, which is so critical to the success of any new technology.”

Christopher McDaniel, president of The Institutes RiskStream Collaborative, said: “Distributed ledger technology has the potential to decrease costs, simplify processes and increase data security across all areas of risk management, and reinsurance, in particular, stands to benefit significantly from this technology.

“The best solution for the market and for reinsurance buyers is to build a successful solution alongside brokers, reinsurers and carriers. Each has a vital role to play and DLT can provide efficiencies to all participants.”

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