State Farm and USAA to Test Blockchain Technology to Automate Insurance Claims
- According to statistical data available online, State Farm processes a total of 38,300 insurance claims on a day-to-day basis.
- Additionally, the firm also currently maintains around 519,000 accounts in mutual funds.
As per an all new PR statement released by State Farm earlier today, the insurance giant along with military-affiliated bank United Services Automobile Association (USAA) is currently in the process of testing out a blockchain-based subrogation platform that will help both companies process their insurance claims in an automated, hassle-free manner.
From a technical perspective, we can see that the above mentioned platform will allow State Farm and USAA to streamline some of their complicated internal processes such as :
- Payment compilation
- Balance Netting
- Payment Scheduling
- Real-time claims settlement
A Closer Look at the Development
A spokesperson for State Farm recently explained that ‘subrogation process’ and how it only takes place when two insurance providers agree on a set financial compensation that will be doled out to a claimant's representative by the “at-fault individual’s representative”.
In regards to the matter, State Farm executive Mike Fields was quoted as saying:
“In 2018 alone, the total amount of dollars demanded and issued through the subrogation process was over $9.6 Billion for all insurance carriers. You can imagine the time and resources required to complete these transactions.”
In closing out this piece, it should be pointed out that State Farm had been looking to create a platform to streamline its subrogation processes since late last year. Not only that, the firm has also secretly been working with USAA since early 2018 according to report released recently.