What are the potential risks and challenges of implementing blockchain in the insurance sector?

1 answers

• Dec 28, 2021 · 3 years ago
  From BYDFi's perspective, one of the potential risks of implementing blockchain in the insurance sector is the reliance on third-party oracles for obtaining external data. Oracles are essential for smart contracts to interact with real-world data, such as weather conditions or asset values. However, the accuracy and reliability of these oracles can be a concern. If the oracles provide incorrect or manipulated data, it can lead to incorrect claims settlements or fraudulent activities. Insurance companies need to carefully select and verify the oracles they use to ensure the integrity of the data they rely on. Additionally, the integration of blockchain into existing insurance systems may require significant changes and investments, which can be a challenge for companies with legacy infrastructure.
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