There are worse things in life than death. Have you ever spent an evening with an insurance salesman?
– Woody Allen
The great American healthcare debate has put health and other forms of insurance in the spotlight for going on a decade now. While many western democracies have socialized forms of health insurance, America’s are paltry by comparison, and the marketplace here is mostly privatized. In much of the rest of the world, other forms of insurance are still private. Collectively, according to multiple sources, all insurance generates more than 5% of all the economic activity in the world.
London, a historical hub of many types of markets, is where InsureX would like to establish the global insurance mercantile exchange – for companies, brokers, traders, and investors. The concept does not require too much explanation: use Blockchain technology to enable faster, more accurate, more secure, and fairer acquisition and sale of insurance products. InsureX says they are deeply embedded in the global insurance industry, and we will investigate that more under the Team category of this analysis, but their best self-description emerges in the following paragraph:
InsureX offers a disruptive environment which will be beneficial to the currently outdated insurance sector. Participants in this marketplace are able to transact business in a highly efficient, secure and consistent manner with easy access to historical data and valuable market insight. The InsureX platform uses blockchain technology to streamline the process between buyers and sellers of insurance products. Not only does it provide a place to find and trade insurance, but a platform to manage the downstream processes related to programs, policies, premiums and claims.
Who InsureX Is Targeting
The InsureX marketplace is primarily for institutions such as insurers, reinsurers and brokers. Bringing these participants together directly results in an efficient, cost-effective and transparent marketplace.
Thus, for most of our readers, the token itself will not be overly useful beyond a speculative instrument. The details of the token become much more important when most of the people who might buy said token will never use it for its intended purpose. We’ll get to that momentarily, but let’s discuss the type of revenue that such trades can generate:
- The average cost of an auto insurance plan in the US in 2014 was over $700 per annum. The United States contains almost as many registered vehicles as it does human beings, and most states require some form of insurance on all of them. If InsureX were to be used for even a fraction of these plans – brokers used the platform to sell more competitive products, improving the quality while cutting the cost – the revenues would be vast.
That is just one regional market in one type of insurance. Nearly anything that generates or costs money in the world has an insurance salesman eyeballing it – this situation will not change as the world moves into more digital forms of commerce, but rather will increase. A platform like InsureX sure has a lot of potential to serve the up and coming legions of insurance salespeople.
Blockchain Meets Insurance
In the push to blockchain the world, many have neglected to realize that there are plenty of purposes where a simple database is sufficient. Most financial purposes would not fall under this category in a neutral debate, because allowing any party to casually make changes to a ledger is a fundamental risk. Therefore InsureX’s decision to utilize blockchain technology is entirely valid for this project, and moreover, the insurance industry itself has long been interested in the technology.
According to the Deloitte Consultancy, blockchain implications can go even deeper than mere registering and trading of insurance products. It could also imply secondary and tertiary marketplaces for things like claims adjustment.
Adopting a common blockchain across the sector could create a step-change in value in the insurance industry: claims-handling could become more efficient and streamlined, resulting in an improved customer experience. Such an approach could also help to reduce further, if not entirely prevent, fraud if identity management was also enforced on the blockchain – meaning that criminals could no longer crash for cash, or exploit the current challenges of sharing data unless their methods for obscuring identities became significantly more sophisticated.
Is it possible that InsureX could become the so-called “common blockchain” for the insurance sector? Well, for what it’s worth, they do have Ross Campbell advising them. Campbell is the chief underwriter of Gen Re, a US-based insurance provider. He has been with Gen Re since 1995, and in the position as overall chief underwriter and head of research/development since 2010. This is to say he has held a powerful position at a sizable (1200+ employees) insurance firm for most of the rise and rise of cryptocurrencies. The insights and connections Campbell will have developed over a long career are perhaps the most valuable attribute so far for the InsureX platform itself, because, after all, like many of these “industry-wide” efforts, there is always a risk that the biggest players in a given industry will simply hijack the idea and implement it in a way that derives them an even more consolidated position.
Campbell recently wrote on the subject of insurance and technology and can be quoted as saying:
Deciding how best to handle issues around data privacy is among the industry’s key questions. Some people will not wish their personalized data to be put in the hands of insurers making decisions about policies, while others will want their data to be used to drive down insurance costs.
This statement brings to mind the notion that blockchain can serve in other capacities than the transferrance of plans and sales thereof – it can also secure the records of individual companies, and InsureX could act as a place that such products were also bought and sold.
Campbell’s involvement also lends an immediate aspect of realism to the InsureX project – it seems evident that once the platform is working, Gen Re will be interested in making use of it.
CEO and founder Ingemar Svensson has a reasonably long career in financial technology. He previously was “responsible for defining the technology strategy and executing an extensive change programme across the organisation.” A simultaneous effort of Svensson’s is called Finserve, and like InsureX, they are looking to apply the blockchain to an industry. The obvious and contemporaneous split in focus could be concerning for potential investors.
COO Christina Dolan, member of the Forbes Tech Council and 2016 recipient of MIT’s Harold E. Lobdell Distinguished Service Award. Over the past few years she has shown an increasing interest in blockchain technology, having taken part in last year’s IBM hackathon. She can be seen here giving a talk on the potential of the Bitcoin market:
In short, she knows her stuff, so putting her in charge of operations is a good move.
Lead Ethereum Developer Nicolas Cherence public information is limited, as are his coding chops. “He holds a master’s degree in statistical and financial engineering from Paris IX Dauphine University” and claims to have worked on financial applications before. Luckily Ethereum work is easily outsourced, so for the most part we can overlook this potential hiring mistake.
Lead user experience developer Charlotte Holmen has already proven some of her competency, having previously worked at Doctify and presumably being responsible for the following screenshots:
The IXT token will be necessary for use on the InsureX platform, and it has a guaranteed deflation rate in two ways: 1) there is hard cap of ___ tokens and 2) each time the InsureX platform derives a fee from activity in the marketplace, a portion of that is forever destroyed. As a result, the value of outstanding tokens on the markets increases with the decreased supply. An example where someone might spend IXT is if one participant wanted to find someone to fill a quote he had given on an insurance deal. Others in the marketplace looking for such opportunities would be notified, and they would then be able to create a fee-generating transaction, while the fee to list the quote in the first place is already captured – meanwhile IXT itself can be used to make deals on the platform.
It’s important not to get too lost in the details – the basic idea is that you will make money if insurers actually use this platform or decide to horde the token, if you are a holder of the token at time of launch. There will likely be competing plays in this space, but the odds are high that the experienced professionals behind InsureX will know how to leverage their first mover advantage.
- A maximum of 133M coins will be created, 100M of which are to be generated during this crowdsale, with a maximum of 83 778 Eth being raised.
- Inflation is outside of the smart contract, so not happening.
This is a hot one. InsureX has done almost nothing to lose points.
The major risk is a potentially slow adoption rate or adoption being split among several competing platforms. As a speculator, IXT’s value will depend very heavily on how much it is used and needed. As such we have to caution against the acquisition of large IXT bags, however dipping a toe into the water could buy several pairs of shoes.
The growth of the insurance industry will fly in tandem with the growth of the blockchain industry. Technology is enabling new forms of economic activity the world over, and all of these will eventually have insurance products tailored to them. As such, the growth of this platform, if initially successful on even a small scale, is tied to the growth of human marketplaces and population – exponential.
A hard 7.0 out of 10, based on everything above. This figure could see serious deductions if performance/timelines become an issue and competing interests push InsureX off the table. As such, despite the high numeric rating, we encourage caution except for those already directly involved in the insurance industry, as those people can consider any losses as part of attempts at innovation in their business.
Open now and about 25% funded at time of writing. If you really want in, you had better get over to Insurex.co now and make your contribution. The rate at time of writing was still over 1000 per Ether. Full disclosure: this author is hoping his Ethereum wallet syncs before the end of the sale.