International law firm Pinsent Masons and Applied Blockchain, an industry leading blockchain solutions development company, launch research highlighting the opportunities and risks for engaging in blockchain and distributed ledger technology (DLT) projects in the insurance sector.

Blockchain has been the buzzword in the Fintech community for some time – a lot of the attention is now focused on how blockchain technology can be used to enable ‘smart contracts’. While there is great potential for smart contracts to make inroads into insurance, many legal questions remain.

Next generation blockchain platforms allow applications or computer programs to be built on the blockchain in exactly the same way as web applications are built on the internet today.  This allows the blockchain to store and execute smart contracts.

Tim Roughton, Partner at Pinsent Masons, says:

“The concept of a ‘smart contract’ is an intriguing one for lawyers – at one end of the spectrum the discussion is about artificial intelligence replacing all of the aspects of drafting, whilst at the other, it could be used simply as a means of executing payment obligations and actions conditional on payment. But that said, smart contracts can offer real benefits to the insurance industry including simplification, automation, increased standardisation and electronic execution.”

The term smart contract has no settled definition and there are many and varied potential use cases. Consortia such as B3i are now forming in the insurance sector to explore opportunities for the application of blockchain and distributed ledger technology.  There are a number of features of the insurance sector that align to the features of blockchain:

  • Insurance is heavily reliant on documentation, data analysis and databases – inefficient solutions are currently being used for recording and evidencing the relationship between parties in insurance contexts
  • Insurance involves many parties/actors – distributed networks could make sense in this context
  • Insurance is a heavily intermediated industry; intermediaries add cost and complexity – the removal of ‘central authority’ record keeper intermediaries has the potential to reduce cost (e.g. fees) and complexity (e.g. multiple reconciliations)
  • Internet of Things (IoT) data and telematics data lend themselves to storage/tracking and encryption on a blockchain
  • Customer onboarding issues remain a concern for insurers – authentication/verification through the blockchain can provide a way forward
  • Reducing fraud is a key concern for insurers – the blockchain promises immutable records and tracking


Peter Bidewell, Chief Marketing Officer at Applied Blockchain, says:

“Smart contracts are so powerful because of their flexibility. They can encrypt and store data securely, restrict access to that data to only the desired parties and then be programmed to utilise the data within a self-executing logical workflow of operations between parties. Smart contracts translate business process into computational process, greatly improving operational efficiency.”

Pinsent Masons and Applied Blockchain have co-authored the research to examine in more detail the potential applications for blockchain in the insurance sector.  To better visualise the added value of blockchain, the paper looks at a real-world example in the insurance sector, explaining the user journey for a blockchain marketplace application that connects customers and insurers for home insurance. 

To download a full copy of the paper, visit:

For more information, please contact:

Adi Ben-Ari, Chief Executive Officer, Applied Blockchain,

Tim Roughton, Partner, Pinsent Masons, [email protected]

About Pinsent Masons

Pinsent Masons is a global 100 law firm, specialising particularly in the energy, infrastructure, financial services, real estate and advanced manufacturing and technology sectors. The firm employs over 2500 people in total, including over 1500 lawyers and more than 400 partners. The firm’s international footprint encompasses six offices across Asia Pacific, two offices in the Middle East, four offices in continental Europe and one in Africa. The firm also has comprehensive coverage across each of the UK’s three legal jurisdictions.

Pinsent Masons LLP is a limited liability partnership registered in England & Wales (registered number: OC333653) authorised and regulated by the Solicitors Regulation Authority, and by the appropriate regulatory body in the other jurisdictions in which it operates. The word ‘partner’, used in relation to the LLP, refers to a member of the LLP or an employee or consultant of the LLP or any affiliated firm who is a lawyer with equivalent standing and qualifications. A list of the members of the LLP, and of those non-members who are designated as partners, is displayed at the LLP’s registered office: 30 Crown Place, London EC2A 4ES, United Kingdom.

We use ‘Pinsent Masons’ to refer to Pinsent Masons LLP and affiliated entities that practise under the name ‘Pinsent Masons’ or a name that incorporates those words. Reference to ‘Pinsent Masons’ is to Pinsent Masons LLP and/or one or more of those affiliated entities as the context requires. © Pinsent Masons LLP 2013.

Pinsent Masons office network extends across the major international business centres of London, Munich, Paris, Brussels, Düsseldorf Istanbul, Doha, Dubai, Beijing, Shanghai, Hong Kong, Singapore, Sydney and Melbourne – and the key commercial centres in the UK.

About Applied Blockchain

Applied Blockchain is an innovative applications development company, focusing on distributed ledger technology and smart contracts. Based in London at Level39 Fintech hub in Canary Wharf, Applied Blockchain has an expert team of blockchain developers that have been building cutting-edge solutions for disruptive startups and corporate clients in banking and finance, e-commerce, energy trading, telecommunications and social impact sectors. We are building a new generation of decentralised applications working through some of the most interesting problems in this field such as KYC, identity management, transactions anonymity, encryption and data security.