EY and Microsoft partner to provide marine insurance blockchain
EY has collaborated with Microsoft, shipping firm Moller-Maersk and other companies to develop the world's first blockchain platform for marine insurance, aiming to streamline a sector bogged down by "complete inefficiency". Shaun Crawford, global insurance leader at EY, said the project aimed to bring transparency to the industry and reduce the high administrative burdens, while capturing information about shipments, risk and liability in a secure manner. The platform will be built by blockchain firm Guardtime using Microsoft's Azure cloud, and is set to be launched in 2018.
Accounting giant EY said Wednesday that it plans to launch the first blockchain platform for marine insurance, alongside Microsoft , A.P Moller-Maersk and others.

The distributed ledger will be used to capture information about shipments, risk and liability, and to help firms comply with insurance regulations.

It will also ensure transparency across an interconnected network of clients, brokers, insurers and other third parties.

EY explained that its decision to secure marine insurance data with blockchain was due to a "complete inefficiency" in the sector.

"The reason we chose marine (insurance) as the starting point for this sort of market is mainly because of its complete inefficiency," Shaun Crawford, global insurance leader at EY, told CNBC via phone earlier this week ahead of the announcement.

Crawford said the industry was "over capacity" and that there was "a lot of cost to it."

He added: "It's facing high administrative burdens of managing and writing claims with a lot of paperwork. All contracts are signed multiple times. They go from ship to ship, port to port, through quite a journey."

Distributed ledgers are groupings of data shared across multiple locations without the need for central administrators and other middle men.

The original blockchain was built to serve as the distributed ledger for bitcoin transactions. But various blockchain experts believe the technology can provide transparency for a multitude of different industries, not just the financial services.

"We're not talking about a new currency here, we're not talking about money. We're talking about data aggregation," EY's Crawford added.

Maersk said the blockchain platform would enable the shipping giant to maintain a smoother relationship with the insurance market.