An insurance company based in France launched a blockchain-based insurance smart contract that compensates passengers for late flights and other flight disruptions. While this seems like something you would expect a small startup to be announcing along side an absurdly priced ICO, this is no startup. In fact, AXA is one of the largest insurance companies in the world (ranking at #3) and one of Europe’s largest companies. AXA had nearly a 100 billion Euros in revenue last year and employs over 160,000 people worldwide.
AXA is the counter-party in the contract and accepts the risk (after-all they are an insurance company) for insuring the contract. AXA’s computer systems scan flights worldwide looking for disruptions and delays, identifying any flights where an insurance contract is active. The contract automatically settles without the need for the holder of the policy to file a claim; It’s all instant and seamless.
This product has interesting applications in the freight sector. You could see the package carriers (or an insurance company) implementing a similar offering for package freight. There is an ecosystem of companies that monitor on-time package data to file claims on behalf of package customers. It also has applications in other elements of the supply-chain to automate claims, on-time performance, etc.
With the proliferation of IOT transaction systems and tracking aggregators, you could also see companies partnering with insurance carriers to offer a similar product in the truckload sector. After all, anyone that has ever spent a day in the automotive sector knows how aggressive the OEMs are towards managing on-time performance clauses in their contracts and penalties for contingent liability. If a truck is delayed and ends up shutting-down a plant, the cost to the automotive manufacturer can be measured in hundreds of thousands per hour. Walmart also recently rolled out a penalty to carriers for showing up early or showing up late that carriers a stiff financial penalty if a carrier has consistent issues with on-time compliance.
Interested in learning more about Blockchain applications in trucking? Consider joining the blockchain standards organization, BiTA. At our November 16 meeting held at Georgia Tech, we will explore similar ideas and concepts around blockchain in freight transportation.