LM TOM Innovation explores decentralising accounting and claims
23 March 2018 – A white paper was released today by the LM TOM Innovation workstream which explores the feasibility of distributed ledger platforms in providing the necessary market co-ordination capability that a syndicated market requires. By decentralising insurance accounting transactions in the London Market, a faster, lower cost path to market efficiencies could be achieved, as well as offering an opportunity for growth by making it easier to bring business to London.
Justin Emrich, CIO at Atrium Underwriters Ltd and joint head of LM TOM Innovation commented “New, distributed ledger technology and its application to some of our core business processes can help us to create a more effective, and significantly lower cost operating model for premium and claims processes. If we remove the shackles of legacy systems, there is no need for reconciliation between carriers and brokers. In fact, the use of blockchain or smart contracts can mean collaborative processes between all parties, including insured, other parts of the distribution chains and third party administrators.
“Last year’s work identified compelling cost savings because it directly addresses some of the embedded inefficiencies that underpin London’s cost disadvantage. If London were to drive towards a new decentralised process, it would firmly signal the market’s intent to be relevant, innovative and disruptive. The platforms proposed here could be shared / federated more widely across participants’ global market operations. Any regularly trading consortia of insurance participants anywhere in the world could adopt these models and take an operating and service advantage. If London makes the move, it will have a first mover advantage for its product distribution.”
For more information please contact: Caroline Wagstaff, Luther Pendragon | Tel: 020 7618 9158