Group purchases of insurance allow users to form groups around common insurance needs. Social Insurance acts as an intermediary to negotiate better deals from insurance companies for these group purchases. Several models of social insurance are described, including premium pooling, online insurance networks that connect seekers and investors, and decentralized autonomous organizations using blockchain and smart contracts. Overall, social insurance leverages peer communities and technologies like platforms and algorithms to provide more customized insurance policies at lower premium costs.

1. Group
Purchase
§ Users form a group around an insurance need
§ Social Insurance acts as an intermediary to
nego6ate with insurance companies to get be:er
deals for group purchases
§ The insurance needs for group purchase are usually
niche needs
Model Descrip2on Structure Players
1
Premium
Pooling
§ Users form a group around an insurance need
§ Each pays a premium which goes into the common
pool (depending on the model, a part goes to fund
the group’s insurance policy)
§ Most models include nego6a6on with insurer
§ Claims are validated by the peer group and paid out
of the common pool (depending on the model, big
claims would s6ll go through tradi6onal insurance)
§ Groups with no or few claims get a bonus at the end
of the period
2
Online Insurance Networks
Tradi2onal
Insurer
Social Insurance
Premium Pool
$$$$$$$
$$$$$$$
Insurance
premium
Claims / Claims-free Bonus
Big claims
Online Insurance Networks
Social Insurance
Tradi2onal Insurer
Nego6ate
Insurance Premium
Commission
Market-
Place
§ On the model of P2P lending, the model aims at
connec6ng insurance seekers and investors
§ Applicants get a quote for a base policy, and can
customize the coverage (with impact on premium)
§ Premiums are grouped into a pool
§ Outside investors invest money to back that pool,
making up the required capital reserve. They get
profit from the extra funds leS in the pool aSer all
the claims have been paid out
3
Decentra-
lized
Autonomous
Organiza2on
§ Applica6ons approvals are automated and fully
transparent, relying on peers feedback
§ Premiums are held in escrow thanks to a smart
contract, and are used to pay claims – one that they
are validated by the peers
§ The model can use policyholders’ social capital to
replace risk underwriters
§ As an example, supplementary unemployment
insurance can rely on LinkedIn as a reputa6on
system: applica6ons and claims are approved by
social network peers, relying on LinkedIn status
4
Insurance Seekers
Outside Investors
Premium Pool
$$$$$$$
$$$$$$$
Pay insurance
premium
Invest $ to
back the pool
Claims
Extra
funds leS
in the
pool
Premium Pool
$$$$$$$$
$$$$$$
Smart Contract PlaXorm
Insurance Seekers
Pay insurance
premium
Automated & Transparent
Claims
§ Social Insurance stands for peer-to-peer mechanics applied to the insurance business, leveraging the power of peer
communi6es, but also on social networks or blockchain principles
§ It is enabled by technologies such as digital plaXorms, scoring algorithms or smart contracts
§ The concept answers the users’ needs of transparency, empowerment and a common goal of lowering the premiums
while benefiZng from a customized insurance policy
WHAT IS SOCIAL INSURANCE?
HOW IS SOCIAL INSURANCE CHANGING INSURANCE?
CHAPPUIS HALDER & Co.
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