United Services Automobile Association Employee PAC - USAA Employee Pac issued the following announcement on May 30.
USAA and State Farm know how important it is to continuously invest, innovate and build for the future. During the 2019 Dig In Conference, the two insurance companies announced a joint net subrogation solution, and are now using real claims data to test how blockchain technology can improve the speed of the subrogation process during auto claims.
Subrogation is typically the last part of an insurance claims process, when one insurance company recovers claim costs it paid to its customer for damages from the at-fault insurance company, which often includes its customer’s deductible. Today, subrogation is a relatively manual, time-consuming process often requiring physical checks to be mailed between insurers on a claim-by-claim basis. In 2018 alone, the total amount of dollars demanded and issued through the subrogation process was over $9.6 Billion for all insurance carriers.
“The blockchain solution we are working on has many potential benefits,” says Ramon Lopez, Vice President, Innovation, USAA. “It helps us automate a manual process securely and creates a permanent transaction record of each payment which can easily be verified for accuracy. It also has the potential to decrease the amount of time for consumers to receive their deductible reimbursement.”
Companies across many industries are using blockchain technology to securely store data and manage transactions. USAA and State Farm have been testing how blockchain can be used to reduce the time needed to complete the subrogation process by securely and automatically compiling all subrogation payment amounts, netting the balance, and facilitating a single payment on a regular basis between insurers.
The blockchain subrogation solution is the first of its kind between two major leaders in the insurance industry. The companies began working together in early 2018 and plan to continue testing to determine if the blockchain solution can be a viable product for industry adoption.
Original source can be found here.
Source: United Services Automobile Association Employee PAC - USAA Employee Pac