The Potential of Blockchain To Ensure True Insurance

Financial insurance is an important component of many people’s financial stability worldwide. People acquire financial insurance in order to ensure they can fulfill their and/or their loved ones’ financial needs if an emergency were to leave them in danger of being financially destitute. Since the unexpected can strike at any moment, the market of financial insurance is a prosperous business.

As of the end of the year 2019, 54 percent of the adults who lived in the United States of America were reported to have life insurance. Judging from the fact in which failing to possess car insurance as a car owner is illegal in every U.S state besides New Hampshire and Virginia, the approximately two hundred eighty million vehicles in operation in the U.S in the year 2019 can be assumed to represent almost two hundred eighty million people in the U.S who each purchased car insurance in the year 2019 or beforehand. 

The number of United States residents who purchased insurance is staggering but not as great as the amount of insurance-related personal information which is in the possession of United States insurance-providing corporations nationally.

People need to give out a lot of personal information to insurance companies in order to purchase certain types of insurance. This personal information is required in order for insurance brokers to be able to provide insurance packages that will best financially recuperate specific potential customers to the same potential customers. The personal information people typically need to give up to insurance companies in order to purchase life insurance are their home address, social security number, and driver’s license number.

Another piece of personal information people usually must give up in order to purchase life insurance is their medical history. Since a person’s personal information can be used to unlock confidential private components of their life, a main moral obligation insurance companies must fulfill is protecting the personal information of their customers. Unfortunately, research has shown United States insurance companies have repeatedly failed to fulfill this moral obligation.  

Data breaches of information belonging to insurance companies have been frequent in the past. Three of the approximately twenty-two hundred reports of health-related data which were hacked into by unauthorized personnel between the years 2010 and 2017 were researched by U.S chief medical professionals concerned more than fifty percent of the U.S health data breaches which occurred in the same timespan.

This fact was discovered by the United States Department of Health and Human Services Office for Civil Rights, an organization that is legally obligated to inform the appropriate U.S federal authorities of reports of U.S patient records being hacked into by unauthorized personnel.

These health insurance plans can be assumed to contain the medical histories of certain customers of health insurance because people need to provide their medical history to the insurance company they are buying a health insurance plan from, in order to purchase a health insurance plan for themselves. If this assumption is correct, the medical weaknesses, including allergies and chronic illness, of the owners of these health insurance plans can be used by untrustworthy people to impose biological harm on the previously mentioned owners of health insurance plans.

This biological harm can include purposely being exposed to physical allergies and having their essential medicine stolen from them. Other findings have shown hackers have possessed information from insurance customers which can be used to ruin these same customers financially. 

In the early fall of the year 2020, it was reported by professionals that the insurance brokerage company named Arthur J. Gallagher Insurance Brokerage had financial information, which belonged to them and/or their customers,  stolen from them by computer-based hacker. These computer-based hackers could use this financial information to steal money that the insurance brokerage company in question requires in order to fulfill the insurance-based needs of their customers.

In another instance, the bank insurance company, First American Financial suffered a data breach in 2019 in which eight hundred eighty-five pieces of the insurance company’s customer-related information, each containing insurance customer-owned bank account numbers and social security numbers, were stolen by hackers. These computer-based hackers could have used this financial information to steal money that the customers of these insurance companies in question need to pay rent, buy food, and pay other essential bills. 

If these insurance carriers used efficient computer information security systems to secure the insurance-related information in the health and financial stability of their insurance customers would be more secure.  The security system of insurance-based information stored on computers can be improved with the implementation of an efficient computer-based information security program. A computer-based information security program which is capable of initializing this desired improvement is Blockchain. 

With proper utilization, Blockchain allows computer programmers to neatly organize transactions into sections called “blocks” and then create a blockchain out of those blocks. In order for Blockchain to be properly used, each block is titled with a specific name that is different from any other name in a blockchain and contains certain information. After each and every block is inputted into a single blockchain, the same blockchain is automatically secured. Of course, you can learn more when you contact blockchain consultants with a deep knowledge of this specific knowledge. 

The security of a blockchain is assumingly entirely based on the requirement of passing a complicated computer-based mathematical inquiry in order to access and edit the blockchain in question. This complicated computer-based mathematical inquiry can only be solved by someone who has “proof of work” on the blockchain in question or by someone who is willing to use up a tremendous amount of the computer-based data and assumedly leave the device they used to hack into the blockchain in question unable to function.

After a person who is not authorized to access blockchain hacks into the same blockchain, the computer or computers they used to undergo the hacking will not be able to use the information from the blockchain which the hackers endeavor to steal. Sometimes following the creation of a blockchain, the same blockchain is reiterated onto each and every computer of a chain of computers. 

The computer-based impracticality of attempting to hack into a blockchain is amplified by the fact that in order for someone to reconfigure a block in the same blockchain at a certain point they must also reconfigure all the following blocks of the same blockchain.  

The implementation of blockchain in insurance security would make it nearly impossible for hackers to access information related to the purchase of an insurance package. Therefore, the rate of identity fraud incidents, bank account information theft and medical information theft related to insurance data breaches are significantly likely to decline in the upcoming three years if Blockchain was used to secure the insurance-related information of the customers of many insurance companies. This computer information system will ensure that insurance customers are truly insured.