The Insurance Association of Mongolia and TEO blockchain has recently unveiled the "Insurance Database," a cutting-edge solution that brings substantial advancements to the industry.

Previously, the absence of a voluntary insurance data exchange similar to the credit databases used by banks led to numerous challenges within the insurance sector. Competitors struggled to reach a consensus, leading to duplicate insurance coverage, and in some cases, different companies would provide compensation for the same loss.

This issue was particularly evident in the domain of vehicle insurance, where a single damage event could trigger double compensation from both "Vehicle Insurance" and the "Compulsory Driver's Liability Insurance Agreement." However, a solution is now at hand, leveraging a decentralized private blockchain technology system.

• How it works: All data relevant to the insurance industry, encompassing transactions and claims, will be meticulously recorded in a secure chain. In real-time, records from one insurance company will seamlessly integrate with the blockchain records of other insurance companies, ensuring the integrity of information without the possibility of alteration by the receiving party.
• Change: Integrating a blockchain-based insurance database not only streamlines the insurance process but also enhances transparency and security, automating key aspects of the industry.
• Beneficial for policyholders: With the establishment of this insurance database, the challenges of the past, which necessitated strict requirements for new customers due to the absence of a centralized data repository, will be overcome. Leveraging the comprehensive customer information within the database, it becomes feasible to enhance insurance conditions and reduce prices for policyholders.

In essence, the introduction of insurance databases capitalizes on the decentralized and unalterable nature of blockchain technology, creating an efficient mechanism for managing insurance policies and claims. Furthermore, this development is expected to foster increased collaboration among insurance companies, intermediaries, and government agencies, leading to a more interconnected and effective insurance ecosystem.