At this moment in time, studies have shown that the insurance industry actively generates billions of dollars in premiums every year. For instance, in 2016, the market for these premiums in a total of 40 countries was of $3.86 billion.
However, most people are not aware of the fact that insurance policies that have cash values can be traded on the market for an even higher value, by selling it to third parties, rather than surrendering the policy. In the U.S alone, policy surrenders and lapses in 2014 were of roughly $112 billion, yet $57 more billion worth of surrenders could have been resold on the market. Some of the main benefits associated with purchasing resold insurance include stable returns, liquidity, a low correlation with some of the other asset classes and a fixed tenure.
Unfortunately, this is often hard to do for a couple of reasons. Firstly, there is no recognized marketplace for selling insurance, therefore sellers often have a hard time when it comes down to finding clients. Secondly, there is no assurance that contracts will go through. If a sale does happen, the buyer will need to pay in advance and trust that the seller will transfer the policy. Last but not least, the process is also quite troublesome, as it can only be done face-to-face, rather than online.
A blockchain-based platform could help address these inefficiencies and turn the market into an open one, where insurance policies can freely be traded among those who are interested. FidentiaX therefore plans to make reselling easier, while also centralizing the entire market on a single platform where prices can easily be compare and insurance policies can be transferred.
With this aspect in mind, this is how the FidentiaX platform will work:
- Listing: Insurance policy holders who wish to get a higher value from their insurance can submit the policy on the FidentiaX blockchain platform and hence attract potential buyers. Clients will then be able to browse through a multitude of insurance policies, see their pricing, and pick what suits them best.
- Offering: Buyers who have made a decision will then submit documents and complete an application form. Afterwards, they cans imply deposit the funds onto the platform. Sellers will then be notified of this.
- Submission: the seller, who now knows that the funds are safe and in escrow, can head out to the insurance company and transfer the policy to the new owner, by submitting the relevant documents. The seller will then obtain proof that the policy has been transferred.
- Completion: Lastly, sellers will upload the proof of transfer onto the FidentiaX blockchain. After the documents have been verified, they’ll be transferred to the buyer, and the funds will be released to the seller at the same time.
By finding a smart way to leverage smart contracts, blockchain technology and consensus-based payments, fidentiaX will help revolutionize the insurance market, by making third-party sales easier, more valuable and trustworthy for both buyers and sellers.
Changing the entire industry is akin to manoeuvring a huge ship, you cannot change the course instantaneously, fidentiaX is taking a baby step approach to tackle the tradable policies market. Slowly but surely, the ship will turn its course and embrace blockchain technology.
fidentiaX well thoughout token strategy is based on 3 tokens to address the various business application of the Marketplace:
fdX token (ERC20) is for the ICO and is an utility token. fidentiaX is a membership based marketplace and membership fees collected will be converted to fdX tokens and destroyed. This effectively reduces the supply in the market and increase scarcity of the token.
ISX token is the Platform Unified Token which is pegged to US$1. This token will be the currency within the platform to facilities transactions.
Currency Representative Token is to electronically represent the deposits made by the customers which will be converted to ISX.
The rationale of having 3 tokens is to manage Anit-Money Laundering risk as well as Foreign Exchange Risk.
Crowd Token Contribution aka ICO started on 6th Nov and will end on 5th Dec. To participate, please sign up for whitelist Late Registration.
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This is a sponsored press release and does not necessarily reflect the opinions or views held by any employees of The Merkle. This is not investment, trading, or gambling advice. Always conduct your own independent research.