Otonomi Uses Chainlink Data Feeds To Help Power Supply Chain Parametric Insurance Products
“Thanks to the Chainlink decentralized oracle network, our shipping delay insurance is able to provide users with fast, effective, and transparent adjudication.”
Co-founder and CEO, Otonomi
reduced admin costs
claim resolution time
Otonomi is the first-ever decentralized platform to bring fully automated insurance contracts to the marine and cargo industry. Otonomi’s mission is to bring transparency to the historically opaque insurance industry through practical, real-world applications of blockchain technology.
Otonomi Needs Access To High-Quality and Reliable Data To Support Its Parametric Insurance Products
The ongoing supply chain crisis has highlighted dysfunction in the current shipping insurance model.
Hybrid smart contracts offer a new solution, enabling the automation of claims and better risk management.
Data integrity is mission critical to these smart contracts as it determines the outcome of insurance claims.
The ongoing supply chain crisis has highlighted fragility within both the logistics sector and the insurance industry that underwrites its day-to-day operations. Shipping delays and poorly managed supply chain risks have led to slow-downs that ripple through the entire economy.
Otonomi recognized the potential for hybrid smart contract technology to protect freight forwarders and shippers against delays and supply chain disruptions, enabling them to quickly overcome the inevitable challenges that arise in the global transport industry. Data integrity is critical to these solutions, as the data determines whether an insurance claim must be filed or a claim payout must be executed according to preset smart contract parameters. What Otonomi needed was a highly reliable, decentralized, and on-chain data solution that could enable anyone to verify the integrity of the data triggering their smart contracts.
“On-chain data is mission-critical for decentralized parametric insurance protocols. Moreover, as it determines whether insurance contracts are paid out, it was critical for us to find the highest-integrity oracle solution available.”
Yann Barbarroux Co-founder and CEO, Otonomi
Otonomi requires an oracle service as blockchains cannot natively access real-world data and events.
Otonomi Integrated Chainlink Data Feeds, Helping Enable It to Quickly and Reliably Execute Its Insurance Contracts Based on Accurate Data
As blockchains are deterministic and cannot natively access off-chain data, Otonomi requires a battle-tested oracle network that can reliably and flexibly deliver high-quality data on-chain to be used by its protocol. Already helping secure leading DeFi protocols responsible for tens of billions of dollars in smart contract value, Chainlink has a proven history of reliably delivering data of all types to blockchains, and is widely used by applications that require off-chain data or computation services.
The Otonomi team chose to integrate Chainlink Data Feeds to help trigger its parametric insurance policies with highly reliable logistics data. When the Chainlink Network delivers an event trigger, such as a shipping delay, the corresponding insurance smart contracts are automatically executed.
“Chainlink Data Feeds provide our protocol with highly reliable logistics data that’s accessible on-chain, helping enable our protocol to reliably trigger and execute insurance policies.”
Yann Barbarroux Co-founder and CEO, Otonomi
Otonomi’s smart contracts use data from the Chainlink Network to determine whether to execute an insurance payout.
Otonomi Delivers a Superior User Experience
After integrating Chainlink Data Feeds, Otonomi is now able to deliver a superior user experience that mitigates human error and prevents fraudulent transactions at a fraction of the cost of traditional insurance policies. And unlike traditional insurance contracts, which take an average of 45 days to settle a claim, Otonomi’s insurance products adjudicate and settle claims in just 45 minutes. Furthermore, having access to highly reliable and real-time data helps enable Otonomi to more accurately determine delays and calculate the most accurate pricing for its clients based on real-time market fluctuations. Additionally, Chainlink oracles make it straightforward for Otonomi to add new data points in the future, helping enable Otonomi to seamlessly expand its parametric insurance solutions across new business verticals.
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