Lithuania

P2P Insurance Platform Completes Year-Long Testing in Bank of Lithuania’s Sandbox

by Fintechnews Baltic March 2, 2021

Ooniq, peer-to-peer insurance platform of Workpower, has completed a year-long of testing within the Bank of Lithuania’s regulatory sandbox.

The regulatory sandbox allows companies developing innovative financial products and business solutions to test them in a real environment under supervision and consultation of the Bank of Lithuania.

The sandbox allows the central bank to identify potential risks and regulatory shortcomings in advance, ensuring that only high-quality and safe products and services enter the market.

The peer-to-peer insurance platform allows its members to form groups with similar interests and protect themselves against losses by pooling funds for this purpose.

Group members are able to make their own decisions on loss compensation. If funds are still available thereafter, they would be returned to the group members.

This enables its members to jointly reduce risks and losses and thus protect themselves against risks in a cheaper way.

An appropriately functioning peer-to-peer insurance model may be an alternative to conventional insurance as well as increase supply and competition in the insurance market.

Marius Jurgilas

“We had an opportunity to better understand peculiarities of peer-to-peer insurance services by employing our regulatory sandbox, and it showed that they could be beneficial to consumers.

 

After considering the results, we will draw up the guidelines and establish the conditions for peer-to-peer insurance activities, which should be proportionate to risks and enable the development of these services,”

said Marius Jurgilas, Member of the Board, Bank of Lithuania.