Patent Issued for Systems and methods for blockchain-based payments (USPTO 11270276): State Farm Mutual Automobile Insurance Company

2022 MAR 30 (NewsRx) -- By a News Reporter-Staff News Editor at Insurance Daily News -- State Farm Mutual Automobile Insurance Company (Bloomington, Illinois, United States) has been issued patent number 11270276, according to news reporting originating out of Alexandria, Virginia, by NewsRx editors.

The patent’s inventors are Bellas, Eric (Bloomington, IL, US), Breitweiser, Edward W. (Bloomington, IL, US), Call, Shawn M. (Bloomington, IL, US), Chapman, Corin Rebekah (Bloomington, IL, US), Floyd, Burton J. (Mackinaw, IL, US), Gomez, Robert (Bloomington, IL, US), King, Vicki (Bloomington, IL, US), Magerkurth, Melinda Teresa (Utica, IL, US), Moore, Eric R. (Heyworth, IL, US), Olson, Steven T. (Bloomington, IL, US), Skaggs, Jaime (Chenoa, IL, US), Smith, Shelia Cummings (Bloomington, IL, US), Turrentine, David (Normal, IL, US), Wells, Timothy Caleb (Bloomington, IL, US).

This patent was filed on January 22, 2018 and was published online on March 8, 2022.

From the background information supplied by the inventors, news correspondents obtained the following quote: “In the world of business an interaction between a business and a customer, or the business and another business, typically requires validation of one or more pieces of information before a transaction can take place. This validation is often achieved by the participants involved in the interaction contacting a central authority that is a trusted source of truth for the particular piece of information. The central authority may then validate, or not validate, the particular piece of information and communicate its findings to the participants. Based upon the validation, or lack of validation, a consensus among the participants is formed and assuming the information is valid the transaction between the participants may take place, and subsequently be recorded.

“Traditionally, businesses, customers, and central authorities have stored information related to transactions, and records of transactions, in databases, or ledgers which have been used in accounting to track transactions and information related to those transactions. Often these databases or ledgers held by the participants must be reconciled to achieve consensus as to the validity of the information stored in the databases and ledgers. Alternatively, as described above the central authority may be responsible for determining the validity of information stored in a database or a ledger and functioning as an arbiter of consensus for interested parties.

“A blockchain is a new way of achieving a distributed consensus on the validity or invalidity of information. As opposed to using a central authority, a blockchain is a distributed database or ledger, in which a transactional record is maintained at each node of a peer to peer network. Commonly, the distributed ledger is comprised of groupings of transactions bundled together into a “block.” When a change to the distributed ledger is made (e.g., when a new transaction and/or block is created), each node must form a consensus as to how the change is integrated into the distributed ledger. Upon consensus, the agreed upon change is pushed out to each node so that each node maintains an identical copy of the updated distributed ledger. Any change that does not achieve a consensus is ignored. Accordingly, unlike a traditional system which uses a central authority, a single party cannot unilaterally alter the distributed ledger. This inability to modify past transactions lead to blockchains being generally described as trusted, secure, and/or immutable.

“Blockchains are typically deployed in an open, decentralized, and permissionless manner meaning that any party may view information, submit new information, or join the blockchain as a node responsible for confirming information. This open, decentralized, and permissionless approach to a blockchain has limitations. As an example, these traditional blockchains may not be good candidates for interactions that require information to be kept private, for interactions that require all participants to be vetted prior to their participation, or for interactions that may only be performed by a subset of all participants.”

Supplementing the background information on this patent, NewsRx reporters also obtained the inventors’ summary information for this patent: “The present embodiments may be related to blockchain technology, including modifying blocking technology to be able to store confidential and/or personal information in a blockchain and maintain data privacy. The embodiments described herein relate particularly to various aspects of processing a blockchain comprising a plurality of immutable insurance policy payment records corresponding to insurance policies issued by an entity. In some embodiments, a transaction request indicating a policy payment for an insurance policy is verified, and a block indicating the policy payment is validated and added to a blockchain.

“In one aspect, a computer-implemented method of processing a blockchain comprising a plurality of immutable insurance policy payment records corresponding to insurance policies issued by an entity may be provided. The blockchain may be maintained by a plurality of nodes connected via a network, each of the plurality of nodes maintaining a respective copy of the blockchain. The method may include: (1) receiving, at a processor of a first node of the plurality of nodes, a transaction request initiated by a source and indicating a policy payment for an insurance policy held by the source; (2) verifying the transaction request by verifying an identity of the source; (3) generating, by the processor of the first node, a block to add to the blockchain, the block including an insurance policy payment record indicating the policy payment; (4) transmitting, via the network by the processor of the first node, the block to at least a second node of the plurality of nodes; (5) receiving, at the processor of the first node, an indication that the block is validated by one of the plurality of nodes using a cryptographic computation; and/or (6) adding, by the processor of the first node, the block to a copy of the blockchain maintained by the first node, the block identified by a hash value that references a previous block in the blockchain, the previous block including at least one additional insurance policy payment record indicating at least one additional policy payment for at least one additional insurance policy issued by the entity. The method may include additional, less, or alternate actions, including those discussed elsewhere herein.

“For instance, verifying the transaction request may include one or more of: (i) accessing a consensus rule associated with the transaction request and shared by the plurality of nodes, the consensus rule indicating a set of authorized sources, and (ii) verifying the transaction request based on determining that the source is included in the set of authorized sources; determining, by the processor, that an existing block of the copy of the blockchain maintained by the first node indicates the identity of the source; receiving, via the network from at least a portion of the plurality of nodes, an indication that the transaction request is verified; verifying that the source is in good standing with the entity; authenticating the source of the transaction request using a digital signature; determining, based on a permission level of the first node, that the first node has sufficient permission to submit the transaction request; and (i) adding the transaction request to a queue of pending transactions, and (ii) detecting that at least one of the nodes of the plurality of nodes verified the identity of the source.

“Additionally, transmitting the block to at least the second node of the plurality of nodes may comprise transmitting, via the network, the block to at least the second node, wherein the second node transmits the block to at least a third node of the plurality of nodes.

“Moreover, the method may further include generating, by the processor of the first node, a public key and a private key for the first node.”

The claims supplied by the inventors are:

“1. A computer-implemented method of processing a blockchain comprising a plurality of immutable insurance policy payment records corresponding to insurance policies issued by an entity, the blockchain maintained by a plurality of nodes connected via a network, each of the plurality of nodes maintaining a respective copy of the blockchain, the method comprising: generating, at a processor of a first node of the plurality of nodes, a private encryption key and a public encryption key pair for a source, wherein the source is not one of the plurality of nodes; publishing, via the network by the processor of the first node, the public encryption key to the blockchain; receiving, at the processor of the first node of the plurality of nodes, a transaction request initiated by the source and indicating a policy payment for an insurance policy held by the source, wherein the transaction request is digitally signed by the source using the private encryption key; validating the transaction request by (i) ensuring the policy payment indication of the transaction request is consistent with policy payment data stored in the blockchain and (ii) authenticating the identity of the source based upon the digital signature and the public encryption key; in response to the validation, adding, by the processor of the first node, an insurance policy payment record to a block to add to the blockchain, the insurance policy payment record indicating the policy payment included in the validated transaction request; and adding, by the processor of the first node, the block to a copy of the blockchain maintained by the first node, the block identified by a hash value that references a previous block in the blockchain, the previous block including at least one additional insurance policy payment record indicating at least one additional policy payment for at least one additional insurance policy issued by the entity.

“2. The computer-implemented method of claim 1, wherein validating the transaction request comprises: accessing a consensus rule associated with the transaction request and shared by the plurality of nodes, the consensus rule indicating a set of authorized sources; and verifying that the source is included in the set of authorized sources.

“3. The computer-implemented method of claim 1, wherein validating the transaction request comprises: determining, by the processor, that an existing block of the copy of the blockchain maintained by the first node indicates the identity of the source.

“4. The computer-implemented method of claim 1, wherein validating the transaction request comprises: receiving, via the network from at least a portion of the plurality of nodes, an indication that the transaction request is validated.

“5. The computer-implemented method of claim 1, wherein validating the transaction request comprises: verifying that the source is in good standing with the entity.

“6. The computer-implemented method of claim 1, wherein the transaction request includes a digital signature associated with the source, and wherein validating the transaction request comprises: authenticating the source using the digital signature.

“7. The computer-implemented method of claim 1, wherein the first node has a permission level, and wherein validating the transaction request comprises: determining, based on the permission level, that the first node has sufficient permission to submit the transaction request.

“8. The computer-implemented method of claim 1, wherein validating the transaction request comprises: adding the transaction request to a queue of pending transactions; and detecting that at least one of the nodes of the plurality of nodes verified the identity of the source.

“9. The computer-implemented method of claim 1, further comprising: transmitting, via the network, the block to at least a second node of the plurality of nodes, wherein the second node transmits the block to at least a third node of the plurality of nodes.

“10. The computer-implemented method of claim 1, further comprising: generating, by the processor of the first node, a public key and a private key for the first node.

“11. A system for processing a blockchain comprising a plurality of insurance policy payment records corresponding to insurance policies issued by an entity, the blockchain maintained by a plurality of nodes connected via a network, the system comprising: a first node of the plurality of nodes, the first node configured to maintain a first copy of the blockchain; a second node of the plurality of nodes, the second node connected to the first node via the network and configured to maintain a second copy of the blockchain; a first processor implemented in the first node and configured to: generate a private encryption key and a public encryption key pair for a source, wherein the source is not one of the plurality of nodes; publish the public encryption key to the blockchain; receive a transaction request initiated by the source and indicating a policy payment for an insurance policy held by the source, wherein the transaction request is digitally signed by the source using the private encryption key, validate the transaction request by (i) ensuring the policy payment indication of the transaction request is consistent with policy payment data stored in the blockchain and (ii) authenticating the identity of the source based upon the digital signature and the public encryption key, in response to the validation, add an insurance policy payment record to a block to add to the blockchain, the insurance policy payment record indicating the policy payment included in the validated transaction request, and transmit, via the network, the block to at least the second node; and a second processor implemented in the second node and configured to: receive, via the network, the block from the first node, validate the block using a cryptographic computation, transmit, to the first node via the network, an indication that the block is validated, and add the block to the second copy of the blockchain, the block identified by a hash value that references a previous block in the blockchain, the previous block including at least one additional insurance policy payment record indicating at least one additional policy payment for at least one additional insurance policy issued by the entity.

“12. The system of claim 11, wherein to validate the transaction request, the first processor is configured to: access a consensus rule associated with the transaction request and shared by the plurality of nodes, the consensus rule indicating a set of authorized sources, and verify that the source is included in the set of authorized sources.

“13. The system of claim 11, wherein to validate the transaction request, the first processor is configured to: determine that an existing block of the copy of the blockchain maintained by the first node indicates the identity of the source.

“14. The system of claim 11, wherein to validate the transaction request, the first processor is configured to: receive, via the network from at least a portion of the plurality of nodes, an indication that the transaction request is validated.

“15. The system of claim 11, wherein to validate the transaction request, the first processor is configured to: verify that the source is in good standing with the entity.

“16. The system of claim 11, wherein the transaction request includes a digital signature associated with the source, and wherein to validate the transaction request, the first processor is configured to: authenticate the source of the transaction request using the digital signature.

“17. The system of claim 11, wherein the first node has a permission level, and wherein to validate the transaction request, the first processor is configured to: determine, based on the permission level, that the first node has sufficient permission to submit the transaction request.

“18. The system of claim 11, wherein to validate the transaction request, the first processor is configured to: add the transaction request to a queue of pending transactions; and detect that at least one of the nodes of the plurality of nodes verified the identity of the source.

“19. The system of claim 11, wherein wherein the second node is configured to transmit the block to at least a third node of the plurality of nodes.

“20. The system of claim 11, wherein the first processor is further configured to: generate a public key and a private key for the first node.”

For the URL and additional information on this patent, see: Bellas, Eric. Systems and methods for blockchain-based payments. U.S. Patent Number 11270276, filed January 22, 2018, and published online on March 8, 2022. Patent URL: http://patft.uspto.gov/netacgi/nph-Parser?Sect1=PTO1&Sect2=HITOFF&d=PALL&p=1&u=%2Fnetahtml%2FPTO%2Fsrchnum.htm&r=1&f=G&l=50&s1=11270276.PN.&OS=PN/11270276RS=PN/11270276

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