Re’s Innovative Approach to Blockchain Pays Off Big Time!
Re, the world’s first blockchain-powered reinsurer, has reported significant growth in the first quarter of 2023. Despite launching late in 2022, the company already backs $34 million in premiums and provides coverage to tens of thousands of small businesses across multiple industries. With a strong pipeline of deals, Re anticipates further growth and significant opportunities as additional capital becomes available.
Re CEO and co-founder Karn Saroya is optimistic about the company’s future prospects. He says, “Re is at the crossroads of a generational opportunity for the emergence of a new reinsurance marketplace, one with a highly curated portfolio of insurance risks without a legacy of catastrophic risk exposure (hurricanes, earthquakes, etc.), built differently to take advantage of a rising interest rate environment and premium rate hikes across the insurance industry. We’ve been afforded solid economics right out of the gate and an opportunity to build something truly new into the reinsurance market.”
Re has built a protocol similar to a decentralized version of Lloyd’s of London. Through Re, alternative capital providers can back baskets of insurance policies to earn premiums and yield. Re’s smart contract protocol is built on the Avalanche blockchain, which allows for greater transparency and flexibility, and ensures the company remains lean with only seven full-time employees.
Saroya believes there is significant operating leverage in their business. By automating policyholder data and claims via their blockchain pipeline, Re can gain an administrative expense advantage over traditional reinsurers. Working with distributed teams on underwriting, pricing, and origination keeps operating expenses low without compromising service. Re has the ability to scale upwards of $500M in premium with their small team of 7 and existing resources.
Blockchain technology continues to evolve rapidly, and Re is leading the way in demonstrating its potential for innovation in the insurance industry. By providing a more secure and transparent way to access the reinsurance market, Re is widening access to institutional investments. Insurance companies are looking to run their businesses more efficiently, quickly, and accurately, and innovation is the key to achieving these goals. Through Re, regulators, coverholders, and capital providers can observe surplus capital positions and salient reinsurance program performance being emitted to public blockchains in real time. This is already driving an increase of alternative capital into the industry and consolidating access to data that has lived mostly in spreadsheets or third-party contributory databases.
In summary, Re’s unprecedented growth in its first few months of operation is a testament to the potential of blockchain technology in the insurance industry. By providing a more transparent, efficient, and secure way to access the reinsurance market, Re is setting the standard for the future of the industry. With a team of only seven, Re is demonstrating that it is possible to scale up to $500M in premium using existing resources, and they anticipate further growth as additional capital becomes available. Re’s protocol is a Web3 application that drives a level of transparency around capital position and performance that is unrivaled by traditional reinsurers, benefiting partners and regulators alike.
If you’re interested in learning more about Re and its groundbreaking approach to reinsurance, be sure to visit their website at re.xyz. There, you can find more information about the company, its protocol, and its mission to revolutionize the insurance industry.
