Our new Disruption by Blockchain series aims to highlight companies that are leveraging the incredible potential of blockchain technology to disrupt and revolutionize their industry. Through one on one interviews, we'll speak directly with industry leaders to cut beyond the hype and get directly to the heart of practical use cases and examples of how it will change the world, one industry at a time.
The following is an interview we recently had with Alvin Ang, Co-Founder of fidentiaX.
1. What’s the history of fidentiaX? How and where did you begin?
AA: The idea behind fidentiaX was first conceived back in May 2016 when we realized there are many inefficiencies in the current tradable policy market and the huge potential market size. We explored various business models over the next couple of months before gathering like-minded individuals to form the core team of fidentiaX.
The team then spent the next couple of months looking at the technology available to address these inefficiencies and stumbled upon Blockchain Technology. Our approach to the project was trying to find the right technology solution to solve a real business case and the benefits of applying Blockchain Technology to our business case were very clear.
We went on to detail down our business case and approach to solve the inefficiencies of the market with the use of blockchain technology in our whitepaper and managed to raise some funds from our Crowd Token Contributions via the issuance of fdX tokens. We are in the mist of releasing our prototype and targetting to release our MVP by end of Q3 2018.
2. Who are the founders and key team members?
AA: The 2 founders of fidentiaX are:
Alvin Ang, CEO, Co-founder
Multi-disciplined entrepreneur with extensive experience in Technology, Engineering, Banking and Insurance sectors. Alvin held senior positions at Standard Chartered Private Bank and OCBC Bank focusing on sales strategy, wealth management, compliance and people development. He is passionate about leveraging technology to solve real-world issues and disrupt the status quo.
Douglas Goh, Co-Founder
Blockchain enthusiast with 15+ years of experience in Banking, M&A and Fintech in North Asia, Singapore, South Africa and European Union. Specialisation in capital raising, deal sourcing and closure, due diligence and corporate structuring. Current Chief Operations Officer of the Uncharted Group and Executive Director of Uncharted Partners. Extensive pre-seed and series A/B investment experience. Former Citi and OCBC management team. Masters Degree in e-Commerce from the University of Melbourne.
3. What problem are you solving? Who are you solving it for?
AA: There are 3 main issues which fidentiaX's marketplace aims to solve:
Lack of Awareness
Policyholders are unaware that their policies are a tradable asset, instead of surrendering their policies to the insurer, they could potentially extract higher value from their policy.
In 2015, out of the US$112 billion worth of policies surrendered in the United States, US$57 billion (250,000 policies) could be resold in the open market.
Investors are equally unaware that buying tradable policies from the open market is a possibility as well as the various potential attached to having tradable policies within their portfolio.
No recognizable Marketplace
The lack of a recognizable marketplace makes it challenging for both sellers and buyers to connect. There are some small-to-medium size entities in various countries working on tradable policies, however, they lack the reach to potential market outside their country. We view these entities as potential partners of fidentiaX's Marketplace whereby fidentiaX could increase/facilitate their reach to more buyers around the world.
Dependency on 3rd Party
In the rare occasion where seller and buyer actually connects, parties need to place trust on a 3rd party to effect the transaction if the seller and buyer does not reside in the same region/country. The cost incurred by having an intermediary to assist in executing the transactions makes it less attractive and the dependency on 3rd party to effect the transaction adds another layer of friction.
4. What is your solution to this problem?
AA: By leveraging on Blockchain Technology, a Smart Transaction would effectively allow buyers and sellers to execute their transaction in a Secured, Transparent and Efficient manner without the reliance on 3rd party. fidentiaX will be the World's 1st Marketplace for tradable policy powered by Blockchain technology allowing seamless cross-border transactions with a peace of mind. Existing players of this industry can leverage on the marketplace as a trusted partner to increase their reach to potential buyers.Sellers would have an additional liquidity option instead of just surrendering to the insurer.
The marketplace has the potential to aggregate members' insurance requirement by direct access to insurers & re-insurers and disrupting the existing multi-layered distribution chain.
5. Why is your industry ripe for disruption?
AA: The surrendered policies value in Hong Kong, Japan, South Korea, Singapore & Malaysia exceeds billions of dollars yearly, policyholders are disadvantaged as they are unaware that their policy is an asset. While there are many insurtech solutions trying to disrupt the insurance industry, there are many red tapes, regulatory and resource constraint before we can experience the benefits of these project.
The life insurance industry generates billions of dollars in premiums every year. In 2016 alone, the total market size for premiums in the OECD region (40 reporting countries) was more than US$3.86 trillion dollars. Emerging Asia will be the fastest growing market for life insurance with an estimated
the real compounded annual growth rate of 10.2%.
fidentiaX will disrupt the status quo and break the tethers of the insurance companies by empowering policyholders to monetize their policies. This is also a fantastic opportunity for us to demonstrate the numerous advantages of building a portfolio of tradable policies with stable returns and developing a trustless platform for trading of these policies.
6. What’s the future of your industry?
Prediction #1: Life insurance policies will move from being Product-centric to People-centric, current life insurance products are “silo” and not portable even within the same insurer. It is almost impossible to make an adjustment to an existing life policy although the life assured remains the same. In the future, a policyholder could have just one main policy with other riders as building blocks/attachment to the main policy.
Prediction #2: Life insurance product would be distributed directly without the need of human intervention by leveraging on AI technology and Robo-Advisors.
Prediction #3: First life insurance policy to be issued directly onto the blockchain and with full automation on administration, maintenance, claims and settlement processes.