While the enormous potential for blockchain in insurance has been apparent for a while, I've been waiting to see a breakout application hit the real world. I think I saw one last week, albeit in a different industry.
An article on Quora reported that Amadeus, a global reservation system, has adopted a blockchain-based system for verifying health clearances, such as COVID-19 vaccination records, for travelers.
The system will have to adapt as the pandemic continues to unfold and, in particular, as policies on eligibility for travel evolve, so success is by no means guaranteed. But I think this rollout is one to watch, because it's the first I've seen that aims at truly massive scale, of the sort that will need to occur in the insurance industry as blockchain tracks certificates of insurance, manages first notice of loss and so on.
Initially, the blockchain system, IBM's Digital Health Pass, is being used by just six airlines: Air Europa, Air Corsica, French Bee, Air Caraibes, Air Canada and Norwegian Air Shuttle. But all 474 airlines in Amadeus can activate the capability, and the need is pressing -- the Quora article opens with a description of travelers queued up at London's Heathrow airport for as long as six hours in April while waiting for agents to make sense of the various COVID-19 health clearances.
"Imagine small cards, stamped documents, and digital apps in various languages and formats," the article says. "The lack of standardization was a killer."
With the blockchain system, travelers provide credentials that back-end technology authenticates against the requirements of each country and airline, recording all information in a secure ledger. When travelers approach agents at airports, they have a QR code emailed to them that is then scanned and validates their eligibility for travel. The process is simpler for travelers and far simpler for agents. The process is also adaptable. As travel restrictions change, the electronic systems can sort through all the complexity in the background and still give the agent a binary decision: authorized or not authorized.
The hope is that blockchain could extend well beyond the health pass and supplant much of the other paperwork, including physical passports, that comes with travel, especially across borders. But just having the health pass work at scale would, for me, be plenty of validation for the blockchain concept.
We know from our friends at the Riskstream Collaborative that applications such as for proof of insurance and for first notice of loss are in advanced stages of development. And once one use takes hold -- even if it's in the airline industry -- I think the technology will mature and trust will increase, meaning that progress will happen rapidly from then on.