Blockchain-based Crowdfunding for Cyber-Product Insurance

Abstract

In order to reduce the expense of cyberthreats, organisations are considering to outsource their cyber-risk control to insurers. However, a number of barriers have prevented widespread adoption of cyber-insurance. First, it is challenging to determine the insurance premium due to the dearth of valid data used to assess cyber-risks. Second, the legal and administrative barriers that prevent insurers from examining an organization's security posture. Contrasted with, the blockchain technology has gained a lot of popularity because of its capacity to offer security and transparency. Blockchain uses the distributed ledger in order to store transaction details, and instead of keeping the data on a single server, the data is kept across a network of computers. This study suggests a fresh framework to cover a cyber-product utilising blockchain technology in order to enhance the use of cyber-insurance. An insurance request for a cyber-product is first made by a Manager. After then, interested insurers submit their preferred pricing for the insurance system to take part in a sealed-bid auction. The insurers will be chosen from among the auction winners, and in exchange for their responsibilities, they will be given tokens. Among the instance the legitimacy of an indemnity request is verified before calling the claim function to locate the appropriate sum in the money received from the insurers. In addition, we provide a fresh approach for integrating a sealed-bid auction into smart contracts for insurance crowdfunding.