Today, we’ll take a look at how decentralized insurance works
The insurance industry is one of the more profitable DeFi business areas you can focus on.
Currently, the insurance industry is a slow-moving entity.
For example, if you want to insure your car, it can take anywhere from seven to ten days to obtain that insurance.
This is because they’re using manual checking and managing options.
DeFi, along with artificial intelligence, can solve this delay problem for the insurance industry.
With faster and more secure approvals, the insurance industry can gain an acceptable level of trust that can lead to even more insurers signing on.
Let’s take a look at some of the insurance options available for today’s small to medium business owner.
1. Best for Decentralization: Nexus Mutual.
This is a decentralized insurance fund that used smart contracts to pool funds and distribute insurance claims.
Once an insurance claim is verified, the Nexus Mutual smart contract will pay out
the insured party from the insurance fund automatically.
Investors in the fund get to vote on which smart contracts and crypto wallets they insure proportional to the amount of Nexus tokens in the fund.
2. Best for Theft & Loss: Evertas.
This is the first insurance company that totally underwrites insurance for blockchain and cryptocurrency users.
Not only do they insure your crypto from online hacks but they also insure from loss of your private keys, which give you access to your cryptocurrency wallet.
Evertas also covers losses due to technology errors and omissions, which include smart contract failures, exchange outages, and hardware malfunctions.
3. Best for Crypto Exchanges: Aon.
This is a traditional insurance company that provides professional risk solutions for businesses. It’s a publicly-traded company on the New York Stock Exchange and offers commercial risk solutions in several blockchain-related ventures like crypto brokerages, cryptocurrency miners, and blockchain protocols.
4: Best for Crypto Wallets: Coincover.
This is a centralized insurance option for crypto wallets, smart contracts, and exchanges.
They don’t directly sell insurance to retail companies, as their focus is insuring cryptocurrency companies from online hackers.
They also let companies sell additional insurance coverage to their clients.
For example, exchanges can sell you private key coverage so you can be insured in case you lose your private keys.
The most unique thing about Coincover is that they offer users an insured crypto wallet where 100% of your cryptocurrency can be replaced in the event of a security breach.
It’s also amazingly secure, as its private keys are locked in an off-line vault, so an online hack is virtually impossible.