A Self-Organized Framework for Insurance Based on Internet of Things and Blockchain

Abstract

Recently, Internet of Things (IoT) and blockchain technology are used to improve the traditional companies. One type of traditional companies is insurance companies. These companies suffer several problems that are leading to decrease their efficiency in modern societies. Many users of these companies are unhappy and dissatisfied because of some problems. The main problems of these companies are that their operations are not transparent. Moreover, their insurance rates are not calculated and in adaptive with customer's characteristics, e.g for low-risk and high-risk customers. Note that, users are not identical to the same insurance rates, which are determined by the insurer. In modern society, we have the IoT technology that enables us to find some specific information about users. This information enables the insurance companies to increase its accuracy. In addition, considering the potential of the smart contract of the blockchain, determining insurance rates must be transparent. This article proposes a self-organizing framework for insurance based on IoT and blockchain, which eliminates the main problems of traditional insurance. To evaluate the proposed framework, it is compared with the existing framework. The results show that it has several advantages over the existing framework and could be useful in near future.