BIG Applies Blockchain Technology to Reduce Insurance Premiums
As a risk-hedging product, insurance plays an important role in society. With the rise of Internet technology, insurance formats have gradually shifted from offline to more convenient online formats.
In today's fast-changing technological climate, revamping the way that someone purchases insurance does not substantially improve the insurance industry at its core. The rapid development of blockchain, Internet of Things, and artificial intelligence have given institutions a new perspective to reshape the insurance industry. BIG is once again at the forefront of things, pioneering the reform of the insurance industry.
At this stage, the composition of premiums is determined by three major indicators. They are the risk premiums, additional premiums, and pre-determined interest rates.
The risk premium is determined by the value calculated by a series of risk indicators such as the actuarial basis and the liability cover of each insurance product. Every insurance institution will have their own actuarial team that calculates this risk premium. Additional premiums are additional costs of insurance, which are calculated based on the insurance company’s operating costs, marketing expenses, and profits. Different companies have different costs. Some well-known companies are known to spend a lot of money on advertising in order to maintain the company's image, or to expand the market. The predetermined interest rate is the legal interest rate set by the local regulatory authority, and there is no difference between large and small companies.
It can be seen from the three major indicators that the "additional premium" of each company is the biggest variable, and since the company's operating costs are passed down to the customer, as such, this translates to a high premium rate.
Through artificial intelligence and calculations based on big data, the BIG platform is able to calculate a reasonable premium range from a large amount of insurance case data, while blockchain technology will then be able to interact with digital assets insured and customize insurance packages through smart contract. There will also be a minimum-reserves fund to deal with users’ risk issues. This also eliminates the risk of institutions becoming insolvent, while reduced publicity costs will further reduce insurance premiums.
A Win-Win Situation for All
In addition to using the Internet of Things, blockchain, and artificial intelligence modules to establish a smart consumer electronics insurance with automatic pricing and automatic claims, the BIG platform also uses an open P2P mutual help community group to reduce insurance premiums. The group has also negotiated with many large organizations which are looking at digitizing their existing business models to utilize BIG's platform to increase efficiency and reduce operational risks. It has formed strategic cooperation with many groups, such as the "Fukoku International Group" and "Hertz Industries", where they will jointly carry out projects in various products such as life insurance. The benefits are that insuring on BIG will reduce premiums and the amount of documentation needed for processing.
As BIG expands the network and involve more groups and institutions, the platform will be able to thrive, and BIG tokens will also show a strong upwards momentum. The new blockchain premium pricing model will further reduce BIG's premiums. As more companies cooperate, more users will realize the advantages of the BIG platform. Also, as more people become strong supporters of BIG, the platform will further develop, and the native token of the platform, BIG token, will definitely outperform the market in time to come.