$9M in life insurance policies tokenised by Infineo on provenance blockchain

$9M in life insurance policies tokenised by Infineo on provenance blockchain

$9M in life insurance policies tokenised by Infineo on provenance blockchain As a tech journalist, Zul focuses on topics including cloud computing, cybersecurity, and disruptive technology in the enterprise industry. He has expertise in moderating webinars and presenting content on video, in addition to having a background in networking technology.

Infineo, a blockchain-based life insurance company, has successfully transferred the ‘first-ever’ tokenised life insurance policy on a distributed ledger system.

Using the Provenance network, Infineo minted policies worth a total of $9.4 million. A partnership with Provenance Blockchain Labs, the group behind the development of the Provenance ecosystem, enabled this industry-first initiative. Infineo is not stopping there, though. They are also laying the groundwork to build secondary markets for these tokenised policies, which will create new opportunities for peer-to-peer transactions and new products supported by tokenised life insurance.

Infineo’s achievement comes at a time when traditional capital markets and the crypto world are increasingly converging. We’re seeing more and more institutions putting conventional financial products – think credit, bonds, and private equity – onto blockchain networks as tokens. This process, often called tokenisation of real-world assets (RWA), has the potential to shake up legacy financial systems, according to a report from Bank of America. The hope is that tokenisation will lead to more efficient systems, faster settlements, and improved transparency.

Reflecting on this innovation, Cole Snell, Infineo’s founder and CEO, said: “By digitising life insurance policies, we’re not just making life insurance more globally accessible. We’re also creating efficiencies and cost savings for everyone involved in the industry, from start to finish.”

Infineo believes that the $3 trillion life insurance market could greatly benefit from blockchain technology. One potential advantage is that it could help protect policyholders and beneficiaries from losing out on more than $7 billion in unclaimed benefits.

As for the Provenance network itself, it’s already making waves in the blockchain world. It currently hosts over $7 billion worth of active home equity lines of credit, according to data from rwa.xyz. The network’s total value locked (TVL) stands at an impressive $13 billion, as reported on Provenance’s website.

Diving deeper: The impact of tokenised life insurance

This development in the life insurance industry represents more than just a technological novelty. Let’s explore some of the broader implications:

  • Revolutionising policy management: Tokenisation could lead to more efficient policy management and claims processing, potentially reducing costs for both insurers and policyholders.
  • Increased liquidity: Traditionally illiquid life insurance policies could become more easily tradable, opening up new financial possibilities for policyholders.
  • Addressing unclaimed benefits: The improved traceability of tokenised policies might help tackle the $7 billion worth of unclaimed benefits in the industry.
  • New product offerings: We may see innovative insurance products that blend features of both insurance and investment, catering to a more diverse range of consumer needs.
  • Regulatory challenges: As with any financial innovation, tokenised insurance policies will likely face regulatory scrutiny to ensure consumer protection and financial stability.
  • Broader tokenisation trend: Infineo’s move is part of a larger trend of tokenising real-world assets (RWA), which could reshape how we think about ownership and investment across various industries.

While it’s still early days, the tokenisation of life insurance policies could be the first step towards a more accessible, efficient, and innovative insurance industry. As this technology develops, it will be crucial to balance the potential benefits with necessary safeguards to ensure the best outcomes for all stakeholders.

As we continue to witness the convergence of traditional finance and blockchain technology, developments like Infineo’s tokenised life insurance policies serve as a testament to the transformative potential of these innovations. The coming years will likely see further experimentation and adoption in this space, potentially reshaping not just the insurance industry, but the broader landscape of financial services.

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