New York-based startup Arbol has unveiled a parametric insurance platform powered by artificial intelligence (AI) and blockchain, developed in collaboration with the RiskStream Collaborative, which claims to be the biggest enterprise-level blockchain consortium of the insurance industry, Arbol told CoinDesk.
Parametric insurance schemes offer compensation for weather-related events such as storms and floods. The market is poised to triple in size according to Allied Market Research, in part due to uncertainty brought about by climate change.
The platform, dubbed dRe, is specifically designed for reinsurance, meaning insurance for insurance companies, and is currently focused towards severe storm catastrophes. "Leveraging validated weather data from leading decentralized climate data network, dClimate, and Chainlink’s industry-standard decentralized oracle network, the platform triggers a smart contract based on wind speed and location for specific peril events," the startup said in a statement sent to CoinDesk.
On top of that, "dRE leverages the Arbol risk framework and pricing platform, which has been powered by advanced artificial intelligence algorithms for efficient underwriting," said a company spokesperson.
The platform automates claim initiation, notifications and loss calculations, to increase the speed of payouts as well as enhance transparency in the system, said the statement.
CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk offers all employees above a certain salary threshold, including journalists, stock options in the Bullish group as part of their compensation.