Abstract
With the rising demand for protection against new risks such as loss of digital assets, novel insurance services and products emerge. In particular, token-based insurance solutions on blockchain transform the insurance business by providing cover for new risks and streamlined, (semi-)automated underwriting and claim processes. In the chapter, we present a general framework of token-based insurance solutions, delegating their fundamental building blocks that include core roles, main tokens and assets, as well as key processes and operations. We describe three major token-based insurance solutions in the market and compare them in terms of native token functionality, tokenized cover types, claim assessment process and capital model. Based on the discussion of the general framework and concrete examples of token-based insurance solutions, we summarize their advantages and point out their drawbacks. We conclude that despite being at a nascent stage, the token-based insurance space bears the promise to unseat the incumbent players with more use cases being explored and more user activities.
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Acknowledgments
The authors thank Niklas Häusle, Vincent Piscaer, Juan Ignacio Ibañez, Matthew Sheridan, and the editors Horst Treiblmaier and Mary C. Lacity for their valuable comments.
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Cousaert, S., Vadgama, N., Xu, J. (2022). Token-Based Insurance Solutions on Blockchain. In: Lacity, M.C., Treiblmaier, H. (eds) Blockchains and the Token Economy. Technology, Work and Globalization. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-95108-5_9
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DOI: https://doi.org/10.1007/978-3-030-95108-5_9
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