In a recent interview with Captive International, partner
Bradley Kruger, explored the benefits Cayman offers as a jurisdiction
for blockchain use in the insurance industry. His comments are included
in the following article.
It is now well over ten years since blockchain – or distributed
ledger technology (DLT) – appeared on the financial services landscape
but it is still capable of generating excitement as its value in
transforming processes continues to develop.
Heading into a new decade, the potential this technology has to
create significant efficiencies in the handling of payments and customer
data is opening up new avenues for opportunity.
In Cayman, where we see a healthy insurance industry alongside a boom
in emerging technology companies, attracted by the tax neutrality and
business-friendly regulation which have traditionally drawn hedge funds
and other businesses to these shores, there are many opportunities for
captive insurance companies to provide insurance to businesses which are
operating in the blockchain sector.
Some 200+ technology companies have established a presence of some
sort in Cayman in the last two to three years and this, in turn, has
created an opportunity for Cayman’s insurance community. Disruptive
technology companies have often found it a challenge to get insurance,
and Cayman’s DLT developers have been no exception. Some Cayman-based
technology companies have expressed interest in buying insurance,
whether that is D&O (directors and officers) liability or other
types of coverage, from local players.
In addition, as blockchain increases its reach and the impact that it
is having in specific industries grows, there will be a related need
for suitable models of insurance. For instance, the efficiencies that
the technology presents for record-keeping and payment-processing, mean
that it is already having a significant impact on the global healthcare
Cybersecurity and data protection are huge issues for the healthcare
sector and, while it presents challenges on this front, DLT could also
become a part of the solution. Blockchain technology and its
compatibility with data protection laws remains an issue, but there is
confidence that a solution will be found and, if this is not achieved
technologically, then regulation may need to adapt to new and future
As we head into 2020, with lawmakers and regulators, globally and in
Cayman, starting to address some of these issues, we hope to see the
adoption of a suitable framework to assist technology companies, and
their insurance providers, to continue making advancements in the
development of this exciting and increasingly useful technology.