Special Regulatory Report: Using Blockchain to Assess Uninsured Motorists in North Dakota

Oct 25, 2022 / by AAIS

Jon Godfread is currently North Dakota’s 22nd Insurance Commissioner. Through his work he prioritizes consumer advocacy and works to ensure that North Dakotans are better aware of the services offered by the North Dakota Insurance Department, beyond industry regulation. He is active, on a national level, starting discussions surrounding insurance regulation including the use of technology, air ambulance service, and health care reinsurance.

One way in which Commissioner Godfread transformed these words into action is through the initiation of a proof-of-concept (“POC) Data Call, in conjunction with the North Dakota Department of Transportation (NDDOT), to utilize the openIDL blockchain platform and to correlate data from NDDOT and auto carriers in the state to quantify North Dakota’s uninsured driver problem.

openIDL is an open source, distributed ledger platform, that infuses efficiency, transparency, and security into regulatory reporting: With openIDL, insurers fulfill requirements while retaining the privacy of their data and regulators have the transparency and insights they need, when they need them. Initially developed by AAIS, expressly for our Members, openIDL is now being further advanced by the Linux Foundation as an open-source ecosystem for the entire insurance industry.

In this video interview featured at AAIS Pulse: Chicago, Commissioner Godfread provides an update on North Dakota’s efforts with this POC Data Call and his hopes for future applications of blockchain technologies.

The POC Data Call initiated by Godfread and the North Dakota Insurance Department, in conjunction with NDDOT, provides the “opportunity to get a rough estimate of how many uninsured motorists are in North Dakota,” stated Commissioner Godfread. He added that the question of “how many uninsured motorists are there?” comes up a lot in legislative sessions when discussing different insurance rates and products– especially in the auto line.

The issue in answering this question is that many motorists don’t self-report their “uninsured” status and by the time data on this issue is returned to the state, it is 18-24 months old. Through this POC Data Call, Godfread is seeking to see if the transfer of data analysis can occur in a quicker, more accessible format.

The current way in which data is analyzed follows this format: Insurance companies pay to send their data to a third party. The third-party analyzes the data. Then, the insurance company pays to get their analyzed data back. Like previously stated, this can take months or years to complete.

One obstacle Godfread is facing is that insurance companies are hesitant to engage in this process– blockchain and distributed ledger-based systems are a big “unknown” to many of them. It’s essential to “massage” these fears and concerns, says Godfread.

Godfread hopes that the POC Data Call can be a cost reduction tool and that insurance companies will see the value of this process and be able to leverage their own data in a more efficient and cost-effective manner rather than the current format that includes a third-party.

The difference between the current format of data analyzation and the POC Data Call is that the POC Data Call values the data itself, and it puts the value in what the information is rather than what the report is. Now is an opportunity to “flip the current format on its head,” and make essential changes.

Godfread has several hopes for the use of openIDL in future information gathering efforts in North Dakota and the greater insurance community:

First, Godfread hopes we can get to access real time data, sooner, rather than later. Next, he hopes to be able to turn questions such as “How many uninsured motorists are there in North Dakota” around in a timely manner, so they can leverage the data and use it to inform good public policy decisions. Last, he hopes to answer the uninsured motorist question.

To hear more from Commissioner Godfread about how the POC is progressing and how the POC will overcome its obstacles, please click the video above.


Tags: openIDL, Insights, Technology, Issues & Trends, Data Management/Distributed Ledger, Tech News, AAIS News & Views, AAIS Insights, AAIS Pulse, Pulse Chicago


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