Page 24 - Insurance Times December 2021

Fig 1: Severity aspect in terms of fro of many sensitive data that customer and insurer both
wants to protect this data at any cost. Also apart from this,
technology design
insurers these days always have pressure to deliver services
successfully in lesser time than competitors. For this, they
need to make sure that the business process is flawless.

Smart Contracts
Nodes in the network verify every transaction, this then puts
a limit on how many smart contracts actually can be processed
in each block, and then this determines how large can be a
smart contract application that directly affects the overall
performance of the network at different levels.

Claims Processing
Claims processing in the Insurance industry is generally
Source: Responses received from Industry experts
scheduled with Smart Contract protocols.
Fig 2: Severity aspect in terms of
Scalability, Energy Consumption and When a network operates at maximum capacity, the quantum
of transactions that can be processed gets limited. Even if
Performance the gas limit for transactions per second is increased, the
existing limit lowers the figure significantly.

3.2 Issue of scalability and surge in claims
during COVID 19
Scalability issue is not an everyday issue. It generally comes
with a wave of a sudden surge in the quantum of transactions.
The outbreak of COVID-19 stemmed from an impulsive rush
in the applications for claims processing. This resulted in
putting pressure on those nodes that have lower capacity as
a result, processing time was severely disturbed as mentioned
by GIC in a report.
Source: Responses received from Industry experts
According to a news report by Business Standard on Health
Severely Impacting Elements (Impacting insurance claims during covid pandemic insurers saw a surge
Insurance Industry) in claims amidst COVID-19. Although the growth rate slowed
down during the phase of July-December, the number of claims
It was observed that both of these triggers can puncture the that arose during the outbreak is comparatively high.
whole functionality of Blockchain. Any coding flaw will change
the structure of the Blockchain and the inability to scale with
the capacity of nodes in the network will also handicap the
whole system.
Determining which of the two triggers is more severely
impacting is important especially in the insurance industry
wherein the times of calamities, the Blockchain can complete
processes rapidly with community governance.

Impact of Scalability, Energy Consumption, and
Performance on Insurance business
In the insurance industry contractual relations involve to and

24 The Insurance Times, December 2021