When conceptualizing the first decentralized peer-to-peer insurance blockchain protocol, we were thinking we’d not only have to build the underlying platform but also run the first insurance Tide Pool. After all, it’s not uncommon for protocols and platforms to build their own proof-of-concept vertical as well. But shockingly the Tides team has been approached by several companies looking to launch their insurance product on top of our protocol. Or maybe it’s not so shocking, given the insurance industry’s problematic high barrier to entry and archaic technology.
We were thrilled when a veteran insurer approached us to host their latest health insurance product. Their Tide Pool is aimed at the fastest growing, yet most underserved and underinsured market in the US -- the gig economy worker. Without the buying power of traditional employers, these independent freelancers, contractors, temp-workers, and solopreneurs who not only pay for coverage out-of-pocket, but are charged 2X more for health insurance on the independent market.
Hard-working US families have seen their premiums increase by 140% over a span of just five years, now averaging $18,000 annually. There are several catalysts to this, but one driving factor has been that catastrophic-only plans became outlawed per Affordable Care Act (ACA) requirements. As of 2014, comprehensive coverage (i.e. a managed health plan for expected expenses) was a requirement of every insurance plan to those over 30 rather than lower cost catastrophic plans (i.e. opting to be covered simply in the case of emergencies).
2019 is a new year in United States healthcare; a year that brings back flexible options to health plans such as catastrophic-only coverage; a year that lowers costs by enabling risk-sharing across state lines; a year that gives “common-interest associations” the same buying power that -- until now -- employers have solely enjoyed. These are the new market conditions that give the first insurer on Tides.network the ability to launch a Tide Pool that serves this core demographic’s needs.
Introducing Rainshine Health & Disability Insurance
Rainshine is the first affordable parametric health & disability insurance offered in a peer-to-peer network for self-employed and gig economy workers. The carrier is unique in its approach to broaden coverage while keeping costs low with a three-in-one model. Their policy covers 1) health & injury conditions, 2) short term disability, and 3) long term disability. This is extremely important for gig economy workers, self-employed, and independent professionals for whom missing work due to sickness or injury means results in lost income. Additionally, Rainshine’s peer-to-peer model can return a portion of surplus unspent premiums back to members or roll them into the next policy term.
Rainshine’s method is one that only the blockchain and Tides can provide. Unlike traditional insurance, parametric insurance is a binary yes-or-no claim triggered by an adverse event, and multisig signoffs will release a single lump sum payment to cover the predetermined cost of care and lost income. Plus, the provenance of premiums paid, proof of funds & solvency, and peer-to-peer stake on memberships is natural blockchain transactional data. Tides.network handles the universal but costly traditional insurance operations -- including actuarial work, underwriting, claims, and payments -- and frees up carriers like Rainshine to concentrate on management and recruitment of members.
Started in the San Francisco Bay Area, Rainshine’s founders are Kevin Sullivan -- a 12-year insurance veteran and insurtech advisor to Plug And Play Tech Center who created six niche insurance products in amateur/youth sports, medical residents/fellows -- and disability risk management author and speaker, Maxwell Schmitz, who manages a disability & long term care insurance brokerage. He also developed a proprietary e-application system to circumvent draconian insurance customs.
The Rainshine duo is already in the process of state commissioner approval to launch their Tide Pool in January 2019 in California, one of the nation’s toughest health insurance markets, followed by other states throughout the US.
Our Tides team is extremely proud to launch the first product for such a growing segment of the market, who pay for coverage out-of-pocket and going broke by unnecessary cost burdens. We can’t wait to get Rainshine up and running on Tides.network.
