LF Live Webinar Measuring & Proving Enterprise-scale Blockchain Technology in the Insurance Industry

## Overview

This Linux Foundation webinar discusses blockchain technology's maturation in the insurance industry, moving from early hype to practical enterprise solutions. Moderator Lynnea Nelson guides a panel including Joan Zurkovich (American Association of Insurance Services), Tram Bo (Moby CEO), Ryan Briggs (automotive and mobility solutions leader), and James Madison (Hartford architect) through the evolution and real-world applications of decentralized blockchain networks in insurance.

## Key Topics

The panel emphasizes that blockchain technology itself works reliably—the challenge lies in developing sustainable business models and governance structures. Early blockchain initiatives failed primarily because they attempted to build centralized platforms on decentralized technology, requiring all participants to join proprietary systems. The panelists advocate for open-source, decentralized, permission-based blockchain networks modeled after successful internet infrastructure, where participants retain control of their data and approve individual queries rather than granting broad access.

A fundamental design principle discussed is "send the query to the data, not the data to the query." Rather than sharing raw data with external parties, companies execute queries against their own data stores and return only requested results. This approach is combined with selective disclosure—the ability to approve or deny individual queries at the transaction level—enabling secure data sharing without exposing sensitive information.

## Technical Details and Use Cases

The North Dakota uninsured motorist proof-of-concept demonstrated practical value. Regulators needed to identify which registered vehicles lacked insurance coverage. Rather than exchanging raw vehicle identification numbers, the solution used hashed VINs to match Department of Motor Vehicles registrations with carrier policy data without revealing sensitive information. This revealed data quality issues—20% of VINs didn't match due to malformed records or non-roadway vehicles like ATVs—highlighting how technical solutions expose business process improvements.

Other use cases include Mississippi's post-storm property imaging collaboration, where insurers query state-contracted imagery to verify coverage and assist FEMA applications, and Moby's dealer floor plan audit pilot. The latter uses geofencing to verify vehicle collateral remains at dealerships without exposing location data, potentially saving $400-500 million annually across U.S. dealership financing.

Future applications include verifying electric vehicle software updates and battery specifications, allowing insurers to understand risk factors while protecting manufacturers' proprietary data.

## Key Principles and Challenges

The panelists identify five critical requirements: zero-trust authentication for every transaction, data privacy compliant with GDPR and emerging U.S. regulations, selective disclosure limiting access to intended recipients, affordable and interoperable standards-based solutions, and decentralized community ownership.

Major challenges include education about new operational models, accommodating different adoption rates among participants, establishing consensus on data models (such as what constitutes a "battery birth certificate"), implementing transaction-level approval gates, managing participation levels to ensure anonymization, and handling fuzzy matching for imprecise identifiers like addresses and phone numbers.

James Madison emphasizes the importance of data model design, noting current insurance statistics follow a 1970s paradigm. The solution must support modern query capabilities similar to spreadsheet pivot tables—achievable only with properly structured data grain and relationships. The team is developing multiple working sessions addressing data model, infrastructure, and architecture.

## Takeaways

Blockchain's success in insurance depends on iterative development starting with simple use cases rather than attempting complete solutions immediately. The internet's development provides a valuable precedent—starting with basic capabilities and allowing innovation to emerge organically. One successful implementation can demonstrate value and catalyze broader adoption. Regulatory collaboration from the beginning ensures transparency and builds confidence in the network. Open-source governance, modeled on Linux Foundation principles, ensures the technology remains vendor-neutral and accessible to organizations of all sizes, from small suppliers to large enterprises. International expansion becomes possible once reference cases prove the model works across different regulatory jurisdictions.