Promoting blockchain-based insurance services
Title: Insuring Small and Medium Enterprises through Blockchain Technology (ISBC)
Comissioned by: German Federal Ministry for Economic Cooperation and Development (BMZ)
Partner: MONRE Insurance Company (Mongolia)
Overall term: 2021 to 2023
Mongolia’s insurance industry is still at an early stage of development. Companies know little about insurance products and do not have much interest in them, partly because they are not used to assessing and managing risks.
People therefore need to know more about risk and about strategies to reduce risks. At the same time, there is a shortage of customer-friendly, inexpensive insurance products.
The German Federal Ministry for Economic Cooperation and Development (BMZ) is therefore supporting the private sector’s engagement in this area within the framework of their develoPPP program. The aim is to promote the untapped potential of private-sector innovation in order to address the challenges that small and medium-sized enterprises (SMEs) face in the field of insurance and risk management.
Mongolian authorities and SMEs can better assess risks and have more options to minimise risks. A user-friendly, blockchain-based insurance product covering water and fire damage is available for SMEs.
GIZ has many years of experience in the fields of index insurance and basic financial knowledge. The project is therefore facilitating dialogue with the government and supporting the project partner, Monre Insurance, in developing the technical structure behind a suitable insurance product. Monre already has experience in producing blockchain-based solutions. The company is interested in establishing a new insurance product which smaller companies can access cheaply via an app.
In concrete terms, the project is helping SMEs and public agencies to improve their understanding of risk and enhance their risk minimisation strategies. It is also supporting the development and testing of a prototype weather insurance product that takes a variety of risk factors into account. In addition, the project is supporting a system which enables companies to understand and assess their own risks in connection with catastrophe events, such as accidents or extreme weather. This system will be made available to all parties involved.
Last update: March 2022