Teambrella, a peer-to-peer insurance system that utilizes bitcoin wallets and multi-signature addresses, recently released a demo on its website to show how the self-insurance system works. Teambrella uses bitcoin multi-signature addresses to allow users to manage the flow of funds in a trustless, decentralized way. It will initially offer supplemental coverage for collision car insurance and pet veterinary insurance, with more types to come. Members Insure Each Other Under Teambrella, users insure each other. They retain control over their own funds at all times. Reputation systems incentivize all members to pay one another when needed. The Teambrella website notes that it has nothing to gain by denying claims. “In fact, we simply can’t do that. It’s you and your teammates who have exclusive control,” it states. In its white paper , Teambrella notes that a typical automobile insurance loss ratio is about 60% and adjustment expenses make up another 10% percent of premiums, with only half of the premiums paid back to policyholders as reimbursements. With Teambrella, if a team member submits a claim, the member and his or her teammates pay the claim. There are no middlemen. Decisions Made By Member Vote Members must be accepted by a team. The team decides how risky the member is. Individual member rates will depend on the level of risk the team decides on. When a team approves a claim, the payee is paid directly from teammates’ personal wallets. The personal wallets are controlled by the team via a bitcoin multi-signature. Teambrella does not keep members’ funds. There are no set premiums. When a team settles a claim for a teammate, the team members pay their part of the reimbursement directly to the claimant. Personal Bitcoin Wallets Each teammate has a personal bitcoin wallet. There are no team wallets. A teammate […]
