Smart Contract-Based Car Insurance Policies

Processes in the insurance economy are often cumbersome and expensive because of the inherently opposing interests of insurers and customers. Smart contracts bear a large potential to simplify these processes and thereby reduce costs. In this paper, we present CAIPY, our smart contract-based ecosystem for simple and transparent car insurance. In CAIPY, smart contracts do not replace but support current processes to enable significant cost savings, e.g., by removing the necessity for manual inspection of insurance claims in presence of tamper-resistant car sensors. However, the involved parties can resort to well-established processes at any time, trading off cost efficiency against process reliability. CAIPY thus showcases how smart contracts can support insurers without introducing new risks.