EthCC 2: Christoph Mussenbrock

so hello everybody my name is Christophe Rosenberg I'm one of the cofounders of is a risk is a risk is building a parametric insurance platform on a serial and I want to show us your latest development we have actually developed generic framework where anybody can build parametric insurance solutions on assume in very short time it's basically something like a Linux for insurance in the human blockchain first of all what is our mission our mission is to develop a decentralized insurance platform what means this decentralized decentralized means that we break up the value chain in the traditional insurance the insurance company is responsible for all aspects of the value chain from the distribution to underwriting managing the policy lifecycle claims management and all these things and in our solution we can break this up and we can enable many participants to collaborate on an insurance product for example some people can do the distribution some people can manage the policy lifecycle other people can provide the data for the claims management and doozie or do the payments and so on so we break up this chain and enable collaboration to do this we need a way to interact and therefore we in to implement at a common infrastructure and people can build with very little effort their own insurance products and so they can they do not need to program all the aspects of an insurance products which is very complicated but I only need to concentrate on the product specific parts like pricing the business rules for claims management and so on and by because we are focusing on parametric insurance we provide a way where the insurance products are much more transparent and fair and that is what my Alexander already mentioned parametric insurance removes the in determinism of the claims management where people never know if the claim is accepted or not and Prometric gives you an objective measurement whether you get a payout or not so our solution we have a complete set of smart contracts which manage see is the complete lifecycle of an insurance policy and we use Oracle's to get the data for the pricing and also for all other aspects of the value chain inclusive including the claims process and of course we can model these processes individually per product products have different types of life cycles and our platform is flexible enough to manage all these different types of life cycles and business processes essentially we have a very small business process engine incorporated in our framework so the process can be modeled individually and the collaboration of these participants which can be many in a certain product is also orchestrated by the use of a token the token actually serves as a medium to to coordinate the interaction of the participants in the value chain and for example to ensure service levels and to ensure the correct behavior of all the participants so that's the product itself is reliable and also predictable for the customer the examples which we have this is our version of flight delay which is in in many aspects very similar to physi and we are using the same I think the same Oracle and the same data provider flight stats and if you like to use it then you can use our demo which is on the slide here FTD demo is red comm and we this product was live and as a licensed insurance in the last year as a market test and currently we are talking with some German insurers to brings us to a new scale and of course the regulatory aspects are difficult and for respect to access that they manage to do it in their corporate environment and know what that means we have a second example so called weather based insurance for crop this is going to be live in April and May its crop insurance for sea Lanka in Sri Lanka you have these unpredictable weather events they have monsoon and twice a years a monsoon will bring rainfall but it's not very predictable and farmers depend on the rainfall so as I need an insurance and there is already an insurance product but it's very difficult to use because it's paper-based and we will automate the whole process and we will also connect weather Oracle to the claims process so the farmer does not have to file a claim but the payout is done automatically in the same way we have hurricane guards it is in Puerto Rico team working on this it's based on wind speed and so as soon as the wind speed is above a certain level then the contract will trigger an automated payout and of course we have much more ideas what we can realize and but first of all we want to start with these three examples bring them to life and then we will see what what we can do else now the architecture of our platform it's actually a set of smart contracts and to manage these smart contracts we have a set of micro services which run in the cloud the smart contracts are basically in three layers we have a base layer which is a basic business engine and business logic of of a policy lifecycle these are the blue boxes in the bottom and these are provided by our decentralized insurance foundations is a decentralized insurance foundation offers these software for free as open source you can go on github and copy it and run it if you like and we have also some green boxes which are elements which we developed together with partners like payments providers these awkward sometimes open source sometimes proprietary depending on the partner and on the top see yellow boxes these are the pieces which is the product owner will create these are only small smart contracts which incorporate the product specific parts pricing claims management business rules which are product specific and in the background the micro Service are used to manage all the smart contracts our experience from two years of running the system is that smart contract is nothing which runs for itself it means it needs to be monitored you have bugs you need to upgrade it and so so this micro service infrastructure behind it enables you to manage these smart contract in a very convenient way so the smart contracts call smart contracts as I said they implement a generic workflow for a policy they provide services to store data to anonymize data of course we need to respect the data protection laws in Europe and other countries we have payment functionalities we have of course Oracle's and we have all the framework which you need to upgrade smart contracts in case the product needs to be modified the pricing has changed and you need to upgrade these contracts and all this stuff is done by the core smart contracts of course is the whole thing is multi-tenancy so many different parties can work on the same platform and this data is kept separately like in a big cloud structure so actually this is a insurance as a service and it has the whole policy lifecycle from application underwriting pay out until policies finalized or ended because of the expiry of other reasons so you see here the the the data flow in the yellow box a again your application specific code the pricing and business rules for all the product specific expects and then you need to talk only to one central interface this is the so-called product service contract this product service contract has functions which you can call to manage the whole lifecycle so it's very easy the product service contract also offers you methods to authenticate and to verify if if the right people are calling these functions so you can verify if the for example the product is registered in our system not everybody can just deploy a product but he needs to register because we have to make sure that only products are run on our platform which are compliant to the regulatory requirements and then the business flow is handled in the policy flow handler which actually manages the different states of a policy from application until expiry and all interaction with the external world is done via Oracle's and to make it convenient for our products we have created a so called query broker the query broker is actually a generic interface to many types of different Oracle's so we can use a chain link we can use Oracle eyes we can use product specific Oracle's which are created by the product itself and the Cree broker provides a unified interface so we we can handle all these calls in a unified way this is a query broker in principle you issue a query to the brokers and the query broker will image an event event is registered by different types of Oracle's the response is routed to the query broker and the query broker will then call back the calling contract and deliver the data and this is nothing special it's just actually a proxy to different types of Oracle's to provide unified access the interesting thing is here that we can link our dip token in this query broker because in our way to see the world you say that the value is always created outside the blockchain yes if you have some computation on chain it's actually not value-creating if you add some numbers or if you make decisions on blockchain that it's not creating value because it's just running code but the actual value is created outside the chain by data providers and people who for example to a claims management so the Korea broker is the right place to measure this value and to also to to to price it and to dupe the fame of the payments for all these services and decorative token comes into play because the tip token will be needed to for everybody who uses a platform he needs to have untold to some dip tokens in proportion to the revenue he generates on the platform and so we create a demand for our dip token and so we run our dip token economy at a single place in our framework yeah this is another example how we use it token in the framework imagine you have a flight Oracle which provides flight data and of course you as a product owner you want to have a reliable Oracle and so you make a contract with your Oracle provider and you say I will pay you but you need to actually take a collateral for the case that you do not and you do not fulfill your service level agreements because in this case if you don't deliver the data then I need to use a backup and so that it creates additional cost and you have to reimburse me for this cost and you do this by giving me your stake tokens so this is a different use of our tip tokens that we use tip token for staking and in case of not fulfilling the service level then people will lose staked tokens and this is done in a central place in the Oracle program and so we have one place where we can manage all this token economy and that's also very convenient for the product builders because they have one single place where they can manage all the payments to their service providers now the micro service level we have a standard micro service infrastructure is a message queue server in the middle and the message queue server interacts with a different micro services and acts as a hub between the different message types and so a product specific contract can issue a message then it is routed with a message queue service to either the core contracts or the third party contracts and this infrastructure is not rockets and it's very using very standard components we use rabbitmq and kubernetes and the nice thing of this message queue infrastructure and micro service infrastructure is that it can be dynamically extended by new services new and new message types and so it's very flexible and that corresponds to our open open approach in the smart contract side and of course the core micro services provide all the methods which you need to interact with smart contracts monitor them and get information out of them so this is a list and also this is also public in the github you can download it and run it if you like and yeah we have additional microservices you see the payments we have gateways to credit card providers like stripe we can also trigger payments to two other or two customers why are transfers so you can use these services and the whole payment stuff is very also very convenient assets we we need to monitor all these smart contracts and we will also offer a monitoring service so you have user interface a web interface where you can directly see what's happening in your smart contracts we have about 20 different smart contracts so it's not easy to track them by either scan you need some web interface to see what's happening and our monitoring system will provides this inside and you can use this for customer service if somebody calls you and asks what is happening with my policy I did not receive my payment can you please check this then the monitoring system will give you all the necessary information and of course we will provide developers with the sandbox because of course you can clone the github and you can install all the smart contract deploy them on a test net run them but it is actually a lot of work and to get everything running so to make it convenient for developers we will provide a sandbox where everything the core framework of smart contracts and core system of micro service is already running for you and you can just deploy your small product specific smart contract on top of it and run it and so you can directly see what's happening and you don't need to care about all the operational stuff which we do for you in the background in the sandbox and the sandbox is actually one instance of a productive system which we will for example use for the resin index insurance in Sri Lanka now that's all questions [Applause] and thank you for your presentation um I'm wondering who do you believe that your system will be white labeled two insurance parties or how how would we call up as a insured person yeah actually there are many different operational modes first of all we are currently establishing a commercial entity which will run a productive instance of the framework and which is open to people who want to use it and the product upon it so this is actually this is one approach of course we are happy if others also takes this opportunity and run instances of this framework on their own currently I don't see so many people who can do this because you not do not even need only technical knowledge and expertise but you need also need a lot of insurance know-how and of course all the stuff is regulations and so we provides this out of the box for you for people who are interested and of course we run our own products on this platform and so we are we our self understanding is that we are not only technical providers but we are also full service providers for all the non technical stuff and so if anybody will copy this and we are happy to do and help them but actually we expect that we for the first time we will probably the only one to provide this full service the technical framework is quite the same I would say for insurance and gambling why don't you try to extend your service too for example peer-to-peer betting or gambling systems actually of course insurance has always had some similarity to betting because we are dealing with risk but in in contrast to gambling we are not increasing the risk so if you are doing a better than you increase your risk you put some money at in the fire insurance it's the contrary yeah you want to reduce your risk and so actually we are focused on insurance only but if somebody finds our stuff useful for implementing a gambling platforms and he's free to do so it's open source after all I'm wondering actually if you have thoughts about use cases that are blockchain specific a lot of lost funds from ICS and similar thing and I want to pick up your mind what what is all your thought is this insurable or is it hard because it's risky absolutely we have also looked after blockchain specific stuff some people for example have proposed that we insure a CD piece of maker if you know if CD P is not fully collateralized and it's in a danger of being liquidated and insurance could step in and collateralize it and protect the CDP from being liquidated that is some use case but that would only work if you would have many different underlying assets not only ISA because otherwise all the risks would be fully correlated and that's not a good case for insurance but of course this is these are use cases and also looking for other places where we could use it and we are also looking for applications which are risk transfer but which cannot be where we can avoid it being an insurance yeah so we have some use case we have a close user group put some money in a central pool and ensure mutually against a risk for example you could imagine proof of stake blockchain and people who are staking they insure against they are the risks that the note is breaking down and they lose money because there's a notice away for some time this will become very interesting if you see removes the proof of stake and people have a lot of money at stake and so these are applications and we expect that we can build these applications maybe even without an insurance receive is having it in insurance in a legal sense so we would avoid the whole regulatory stuff and it becomes much cheaper so we are open for this so of course everybody's invited to make invent some ideas and we are happy to hear of this okay thank you so much for having me [Applause]