The European Insurance and Occupational Pensions Authority (EIOPA) published today a discussion paper on blockchain and smart contracts in insurance. The aim of the paper is to provide a high-level overview of risks and benefits of blockchain and smart contracts in insurance from a supervisory perspective as well as to gather feedback from stakeholders.
On one hand, blockchain has the potential to deliver key digital
opportunities, reduce duplication of processes, increase process
automation and efficiency, enhance customer experiences, and improve
data quality. On the other hand, the adoption of blockchain may also
trigger new risks to insurers, supervisors, and consumers. As blockchain
technology is still evolving, several challenges are emerging, such as
the complexity of the technology, energy consumption, data protection
and privacy, cyber risk, integration with legacy infrastructures, or
interoperability and standardisation between different blockchains.
Although the current regulatory and supervisory framework can be
considered mostly effective to address emerging risks, specific issues
should be considered, based on the evolution of the technology and its
uses in business processes. It is important to ensure appropriate
understanding by insurance undertakings and supervisors as well as
proportionate governance policies and processes, to guarantee that all
relevant risks are identified and properly managed.
EIOPA invites stakeholders to provide their views to this discussion
paper by filling in the EU survey by 29 July. The feedback is welcome
to all parts of discussion paper covering blockchain, smart contract and
crypto assets use cases in insurance, related risks and benefits and
regulatory barriers as well as possible European approach to blockchain
and smart contracts in insurance. EIOPA will assess the feedback to
better understand and address blockchain developments in the insurance
sector as well as the risks and benefits related to them.
Download the discussion paper
EIOPA
© EIOPA
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