Using data science to discover insurance fraud

This paper aims to discuss the notion of fraud within the insurance industry. Fraud has been identified as quite prevalent within the insurance industry and can be quite costly to insurance…

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Pyramids!

How does that work?

– So how is data stored?

This system inherently provides redundancy, as any file can be pinned multiple times. In theory a file could be pinned by every peer in the network. Thus a high degree of data safety can be reached, because any file will remain available, as long as at least one peer pinning the file remains online. But if a file is considered important, it will be pinned many times. The network is global. No single country or authority can decide to remove the file, because nobody is able to shut down the complete network.

For their clients the risk is even smaller. A pinning service can be easily replaced by another one, and not much of the underlying technological interfaces will change. Also more than one storage provider can be used, and this will drastically increase data redundancy and data security.

The technology might be immature with some respects, but on the other hand its advantages are so enormous, that its potential cannot be estimated high enough.

Very often, while doing something in the programming field that you believe to be new or original, you suddenly find out that someone else is already doing similar stuff.

But with this project — as with many others — only future will tell if it succeeds or fails. Not knowing about the outcomes in the future makes working in the blockchain and P2P area so fascinating! Every evening you go to bed and you do not know what will have changed when you wake up the next morning.

As I said, Blockstack is ambitious. Personally I have learned the hard way that modesty should sometimes come before ambition, if you want to get good results. We should keep an eye on Blockstack!

So how can we be sure to control our data, keep it secure and make it available only to people we trust? There are basically two possibilities:

The second possibility is well suited for large companies or institutions: Here you control all of the IPFS peers in your own network, but you will have only as many peers as you manage to setup yourself. If your company goes bankrupt or your institution fails to persist for whatever reason, your network will go down. You will loose most of the resilience that can come with a public and world wide network, but you may gain confidence and trust, as you shield yourself against many threats from the outside.

Still I am sure that many of the global players will go with possibility two — if they consider such a network at all. The first possibility just means that your data is distributed all over the world, even if it is encrypted and unreadable as long as you control your encryption keys. So in this case your data is just as secure as your cryptographic competence is high. But many companies are not so self confident in this respect. There are so many stories about data leaks. Every month new incidents happen. This is why many people will try to close things up as much as they can — and they will go with possibility two.

In the end it will depend on your use case which solution is the best for you. And it will mainly depend on your specific security requirements.

Here we will call the place you use for data storage pyramids. This alludes to ancient pharaohs who tried to become immortal by getting buried in huge graves like the Cheops pyramid. Today we state that in our Pyramids your data will be preserved eternally and securely, just like the pharaohs hoped would be the case for their dead bodies.

Inside a Pyramid data is stored in CHAMBERS, and each CHAMBER is sealed. With sealed we mean that data cannot be changed without breaking the seal, and so a change can never remain unnoticed.

This application always encrypts data, and the encryption is done on your machine inside your web browser. So, no unencrypted information about you and your data will ever leave the browser.

You can also sign your data by applying a digital signature to it. Such a signature can be compared to a conventional signature done with a pen, but it is executed by means of modern cryptography.

By signing your data you obtain the same effect as with a conventional signature: You can express your consent with the contents, just as you do by signing a contract presented to you on a piece of paper. Or it confirms that you have written a document yourself.

In many cases a document only gets valuable or important, if it is signed. Also, a document can be signed by multiple parties, just like in the real world.

It is not yet true, that any usecase can be completely built on top of P2P-Networks solely. Neither smart contracts nor decentralized storage networks like IPFS can replace today’s mainstream infrastructure completely. DApps are still not ready for prime time. I wish they were!

Various questions remain unanswered, and in some areas there are so many competing efforts going on, it simply cannot be foreseen which one of them will prevail. Take blockchains for example: In software development it is needed — given a specific requirement — that there is only a limited number of blockchain platforms can be considered to be suitable. This number must not be too large, so that a choice can be made without to much risk. It needs to be sure, that in a couple of years the chosen blockchain will still be maintained and successful. But the current situation is not yet clear enough to allow such well thought decisions.

Today one can just do best effort. So I personally define a DApp in a slightly different way: A DApp is a web application that tries to avoid centralization as far as possible. In this modest sense, Eternitas is really a DApp, because everything possible has been done to avoid central servers.

There is one huge advantage of DApps many people are not yet aware of: It is less work to program them. Ordinary web applications are vastly more complex. This is not so obvious, as not many programmers are trained in programming DApps. Know How, documentation and the needed programming infrastructure (support for common IDEs for example) are not widely available. That’s why things seem to be more complicated than they really are.

For a conventional web application you normally need a backend. The web browser running the frontend communicates with this backend. A browser does not only receive the web layout through servers, but most other information as well. The programming logic tends to be implement on the server. There usually are several communication protocols responsible for the data exchange between client and server.

All this needs to be configured or even programmed. Namely the server(s) need(s) to be configured or even programmed — and need(s) to be maintained during the whole life cycle of an application. Things are getting so much easier if there is no backend at all. That is why there will be DApps all over!

In a P2P-Network maintenance is shouldered by a very much larger number of people. And first of all: You do not have to program or configure it yourself. Its interfaces and protocols might change over time, but they will be standardized all over the world. You as an application developer will definitely not be the one who is responsible for them. So these protocols will sooner or later be much better established and supported than any proprietary solution implement by yourself.

I did a lot of pet projects as a developer. This means that I was responsible for the whole thing myself and I could do whatever I liked without having to ask anybody. But what you find out quickly when you do such things, that your capabilities as a programmer are always limited, and you will most likely never reach more ambitious goals, because a whole team would be needed.

So I learned the hard way that I have to live with my limited resources and cannot go beyond them. If I had to implement both client and server, just to build a small proof of concept, I were more than happy to save some work. Yet again, P2P-networks come in handy: Half of your work is already done, if you find a way to use them, instead of writing a completely new backend from scratch (or even worse: use one of the existing application servers).

If two banks merge, you often have two incompatible IT platforms that absolutely need to come together. But merging them is an incredibly expensive and time consuming task. Software developed during decades is sometimes not maintainable — even without the need of a merge. Such modules should have been decommissioned years ago but they often remain up and running to save costs.

Finally the question comes up if such software components can survive a merge at all. That is why these mergers can fail even after years of hard work done by many people.

In the (hopefully better) future, that sort or problems will get less complex, if the server side is gradually getting replaced by P2P-networks. It would even help, if such networks were internal to a company, or they might be shared only between partnering companies or institutions. In any such case, merging will be easier, and also many other ways of cooperation between organizations.

Cryptography gives you enormous power — if you can handle it. That might also be the reason why the basics of this art is rarely taught to young people. If the majority of the people knew about its possibilities, they were much more difficult to control or rule. There is just not much motivation for governments to teach their people such stuff. It could make citizens more autonomous and less transparent.

A good example is encrypting e-mails. This is possible today, and there are plugins for all major e-mail clients enabling this feature. But it is rarely used. It always comes with a loss of usability that many people evade. Or they might just not know about the possibilities. It is just so easy to write a simple e-mail. Why spoil that process and make it more complicated? Simplicity is the main reason why e-mails have become so successful. If you take away simplicity, people just turn away.

If you add encryption to e-mails, you mess things up. You suddenly need to deal with incompatibilities. There might even be the need to exchange public cryptographic keys. To do that, you must understand the basics. Here we are: It will never happen! And for the powerful it is always better to leave others unaware of certain things …

However, as cryptography is still needed in many situations, it is available almost anywhere. Best of all, it is available in browser.

Most likely due to valid security considerations pages served by the older HTTP-Protocol or any servers without security certificate are excluded from SubtleCrypto. This implies that content providers providing encrypted content or the possibility for users to encrypt content cannot remain anonymous themselves. Someone always needs to register and give away his address, if he wants to serve such content. That might make sense in countries respecting human rights and sticking to a somehow ethical legal system. But what about other countries?

Saving the credentials is the tricky part, as usual. Every time the page is loaded, three things happen:

These are your credentials. If you click on the golden key in the top left corner you can download your credentials and save them somewhere. You are the only person responsible for this sensitive data. You must keep them secret and never loose them.

There is no conventional login process for Eternitas, as your credentials are completely unknown to anybody but you. You can load credentials back into the page just by dragging and dropping the file (previously created by clicking on the golden key) onto the golden key again. Nothing will happen, as this application is somehow minimalist.

Actually, you need to be clever and edit your credentials to make the a little bit more useful. I am telling you how …

The file you have created by clicking on the golden key represents your pyramid. It is also the key to this pyramid. So let us give it a name.

Open the file in a text editor and look for a section like this one:

Just change that:

And enter your name for the signature:

(You will find that in the section containing the signature keys)

(OK: Using a editing JSON-File is not an easy task for most people. There will be the need to provide a graphical user interface in the future. We are working on it!)

The most important part is still missing. You will need to add more credentials to the file, if you want to make some of your data persistent. Persistence always means that somebody has to provide disk space for you, and this person will need to charge you for that.

Now that you have successfully “pimped” your credentials, you can drag and drop the file back onto the golden key. This should change the page a little bit, and you can now see the name of your pyramid written in the sky, and at the bottom you can find your name as the SIGNER.

You can now drag and drop a (not too large) file onto the area marked Drop Zone. The file will be encrypted and saved to IPFS. But more than that happened: You have just created and sealed your first CHAMBER inside your pyramid. The seal of your CHAMBER is shown to you on the left bottom of the page. The file you just uploaded is also named in IPFS-style and written below the name of your pyramid.

You can add more files the same way. With each iteration, a new CHAMBER will be created containing the new item plus all the items that you previously added.

Each time you find a new seal on the bottom, and the list below your pyramid name is growing.

You will never find your data again, if you do not click on the link next to “CHAMBER:” and save that file. If you want to get back what you saved, you click on one of the links below your pyramid name, and you can download your file again. It is automatically decrypted for you.

Never reload the page and never click on the pyramid name, if you have not saved your CHAMBER! Now let us assume, that you did save your CHAMBER. If you click on the pyramid name now, the CHAMBER will be gone. If you drag and drop the file associated with your CHAMBER back onto the Drop Zone, you will get everything back. But do not reload the page, because in this case your credentials will be lost and recreated. OK — you have already saved your credentials. So, just reload the page now! Here we are, back at the very beginning. Now you drag and drop your credentials back onto the golden key, and you will be “logged in” again. Now drag and drop your CHAMBER back onto the Drop Zone, and you will get all your data back.

Your CHAMBERS are always sealed, but they are not signed yet. That just means, that anybody could have sealed them. You cannot yet prove that you are the one who did it. So let us sign the CHAMBER now. Click on the feather for that. This is a complicated process. I wish you well! It will take a while, and when it is finished and went well, you will find your signature written above the Drop Zone. There is also a new entry in the bottom line. Click on the link next to “SIGNATURE:” to download and save your signature. It will prove that you have sealed the CHAMBER and that you agree with its contents. It wil also suffice to recover the contents of your CHAMBER. The CHAMBER can never change. Nobody can get into it, unless he has your credentials.

The Blue Mauritius is just the third icon on the top of the page. To be honest: There is no action triggered by this icon. It is unimplemented. Later on it is supposed to help you share your CHAMBERS with others. For example, such a CHAMBER could contain your complete inheritance. By clicking on the stamp, you can transfer everything to your heir.

It still needs to be explained what the two text fields below the Drop Zone are meant for.

I could only describe the functionality in a very concise way. It will not be obvious immediately, what the meaning of a CHAMBER really is, and what you can do with the SIGNATURES. Start thinking about it! You will begin to realize that a whole spectrum of use cases can be realized with that concept.

Do not take the pyramids-metaphor too serious. Other metaphors can fit in as well, and they will help you find even more implications and possibilities of this. Maybe some imagination is needed to go further. Also, a lot of things still need to be done. Let us go for it!

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