General Questions
What is Ensuro?
Ensuro is a decentralized, licensed insurer on a public blockchain. We use smart contracts to curate competitive insurance portfolios. We are determined to create a simple entry point to insurance investments for investors, and a more efficient alternative to traditional (re)insurance companies for risk takers seeking capacity. By opening up the insurance market to new players, we fuel innovation for established and upcoming insurance partners.
What was the original idea and motivation behind the creation of Ensuro?
We were looking for a way to connect decentralized finance (DeFi) to the real world. Insurance was a good fit for two reasons.
First, an insurance contract is fundamentally a set of rules: if a predefined loss event occurs, the policyholder receives a payout. For certain insurance policies, these rules can be encoded into blockchain-based smart contracts, enabling automatic claim payments.
Second, DeFi innovations allow for the automation of capital management in insurance. Additionally, the rapid growth of assets invested in DeFi presents a novel potential source of capital for the insurance industry.
How does Ensuro connect DeFi to insurance?
Ensuro attracts capital from DeFi investors in the form of stablecoins (cryptocurrencies pegged to the US dollar), offering interest in return. This capital is then utilized to provide underwriting capacity to risk partners.
Risk partners can issue insurance policies in traditional (non-crypto) currencies like Dollars or Euros. Premiums are transmitted to Ensuro and converted into stablecoins. Ensuro then automatically allocates the necessary solvency capital to each policy.
All accumulated capital is invested by Ensuro in DeFi protocols, such as Aave. The returns Ensuro can offer its investors stem from two sources: premium income and DeFi investment yields.
What types of insurance products are suitable for DeFi capital?
Parametric insurance products are ideally suited for DeFi capital. In these products, payouts are triggered based on external data sources. Ensuro utilizes a blockchain oracle to transmit data from these sources to its smart contracts, enabling automatic claim payments to policyholders.
DeFi capital can also be applied to traditional indemnity-based insurance policies, where a claims adjuster can trigger a smart contract. Warranty and protection policies are well-suited for this model.
What is the legal framework your products are in?
Ensuro has received an Innovative Insurance General Business (IIGB) license from the Bermuda Monetary Authority (BMA), effective April 30, 2024.
A BMA IIGB License and a DABA M License allow us to:
Access to the rapidly growing digital asset markets to source solvency capital for capacity to underwrite a range of traditional and emerging risks for our risk partners. It also allows us to provide a bridge to real-world assets and returns for crypto investors.
Ensuro is structured as a Segregated Account Company (SAC) in Bermuda. This structure allows our risk partners to leverage Ensuro’s licenses to create their own individual captive insurance cell and design coverage tailored to their own specific insurance needs.
Bermuda was Ensuro’s domicile of choice for the following key reasons:
Bermuda offers a sandbox environment to test and develop innovative insurance initiatives.
Advanced digital asset regulation aligns with Ensuro's innovative solutions.
Bermuda's global acceptability (Solvency II, NAIC, Asia, Latam) fits Ensuro's global business initiatives.
What are the advantages of Ensuro?
Ensuro's model introduces significant enhancements and benefits across the risk transfer chain and to its stakeholders:
Access to a new asset class
Offers crypto investors portfolio diversification with a low correlation to traditional and crypto market trends
Plans to extend insurance risk investment to retail investors, currently limited to institutional players
Provides liquidity providers (LPs) full visibility of risk allocation and real-time performance tracking, unlike similar investments such as ILS
Competitive capacity pricing
Delivers capital to risk partners on highly competitive terms due to operational efficiencies and higher investment returns
Serves an underserved market sector: new and innovative products lacking industry profile and track record
Leverages the broader DeFi ecosystem for supplementary investment returns, potentially sourcing capital at attractive rates. Ensuro's Asset Managers contracts can deploy the pools' capital in other protocols such as Aave or Enzyme Finance.
Bridge to sustainable returns and real-world applications
Offers DeFi investors, some from protocols with unsustainably high returns, opportunities in insurance risk and value-added products
Provides a transition from crypto-only investments to real-world assets
Efficiency Through Automation & Web3 Technology
Manages policies automatically via smart contracts, reducing operating expenses
Eliminates costly claims and underwriting teams, streamlines administration
Enhances transparency and simplifies auditing through blockchain technology
Reduces fraud potential and human error in claims processing
Real-Time Monitoring
Offers a dashboard for real-time product performance monitoring
Provides stakeholders access to blockchain-stored policy data for customized analytics
Enables quick corrective actions, contrasting with traditional reinsurance carriers' delayed visibility
Do you have a token?
Our token is not available yet. Should the team decide to issue one, an official communication will be released on Ensuro's official channels.
What is the price of the Ensuro token going to be?
We do not speculate on the price of our token.
Is there any risk?
No platform is entirely risk-free. The Ensuro platform faces two primary risks: smart contract risk (potential bugs within the protocol code) and underwriting risk (potential losses on insured risks), also known as insurance risk.
We've taken extensive measures to minimize these risks:
The protocol code is public and open source, promoting transparency.
The code has undergone two audits, with the most recent conducted by Quantstamp.
Which communication channels do you use?
If you want to know more about what we are doing, do not hesitate to leave us a message here or reach out to us through the following channels:
Telegram | Discord | Linkedin | X
Additional information and resources about Ensuro
For a comprehensive overview of Ensuro Protocol mechanisms, please consult our White Paper.
Developers can access our technical documentation for an in-depth description of the protocol.
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