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Last updated: Aug 22, 2023
InsurAce is a decentralized multi-chain protocol that provides insurance products to its clients without the need for a KYC check.
Released in April 2021, InsurAce has started with an initiative to address common issues within the DeFi insurance scene such as product accessibility, risk control management, and capital efficiency. The platform offers its users easy access to insurance services by eliminating KYC, offering cross-chain portfolio-based coverage, and competitive portfolio premiums. Users can also get sustainable investment returns through the Investment Portal and gain rewards through the Mining Program.
The design of the InsurAce platform is separated into four main layers - users, operations, products, and infrastructure.
The users layer offers clients of the project access to its products and is further meant to be used by investors, underwriters, the advisory board of InsurAce, and other community members. The operations layer is where core interactions with the InsurAce protocol occur. Here different stakeholders can access cover purchases, submit claims, stake, invest, and redeem assets, while also taking part in voting over submitted claims. The products layer hosts product pricing and development, while the infrastructure layer provides for the InsurAce protocol’s interactions with external oracles and grants the platform’s cross-chain aptitude.
InsurAce provides its users with protection against smart contract vulnerability risks, custodian-related risks, stablecoin depeg risks, and there is a bundled cover opportunity.
Smart contract vulnerabilities include malfunction and programming flaws as well as malicious, criminal attacks, and hacks or exploits of any programming flaw. The full Terms & Conditions, regularly updated, are hosted on the project’s documentation webpage.
The Custodian Risk Cover provided by InsurAce offers users protection in cases where loss of assets occurs while the product’s purchaser is a user of a designated custodian who has lost funds due to criminal or fraudulent takings, or has completely suspended all withdrawals for a continuous period of 90 or more days without any prior notice. Terms & Conditions can be accessed through the documentation platform of InsurAce.
The Stablecoin depeg risk coverage’s Terms & Conditions safeguards users holding UST, USDT, MIM, and BUSD. Each token has different terms of service. Similary, the Bundled Cover’s Terms & Conditions vary based on each cover pack.
During Q1 2022, InsurAce released the v2 of the project, which although still in development, features new products such as a multi-chain aggregator, on-chain cover cancellation function, and dynamic pricing models.
In the event of a loss of the insured assets, claims are first assessed by insurance experts before being put to a vote by the claim assessors. Votes are weighed by the number of tokens staked (with a maximum possible of 5% of the total vote per wallet).
Typically, InsurAce users can take a role of an investor, an insurer, or an insuree. Investors deposit assets in products with different risk/reward ratios, insurers stake assets into the mutual insurance pool, and insurees can buy insurance covers, and request claims when the policy is triggered. All three participants benefit from the interaction between the investment and the insurance arms, as the insurance arm provides coverage to the investment arm, while receiving the investment yield in return as an incentive for the insurers and insurees.
One more role in the InsurAce community is a claim assessor, who can vote on the claim and earn INSUR tokens in return if their vote matches the voting result. Anyone can become a claim assessor by staking their existing INSUR tokens before the start of the voting session.
The InsurAce app products and services can be accessed via Trust Wallet, WalletConnect, MetaMask, imToken, and Coin98 wallet. The preferred network can be chosen on the main dashboard on the top of the dApp. The insurance and investment products can be found on the same dashboard.
The platform offers a bridge mechanism for sending its native INSUR token from the Ethereum network to BSC, Polygon, or Avalanche for lower fees.
InsurAce fees depend on the chosen coverage product, the duration of the insurance, and the cover amount.
InsurAce farming opportunities include underwriting mining and liquidity mining.
Participants who stake tokens into the underwriting pools on the platform gain INSUR tokens as a reward. Unstaking is possible at any time, but it is subject to a 15-day lock-up period until funds can be fully withdrawn.
The total supply of INSUR tokens is 100 million, 10.75% of which was sold in the seed round ($1 million raised), 9.25% sold in the strategic funding round ($3 million raised), and 2% was sold in a public sale on Balancer LBP for liquidity bootstrapping. The rest of the tokens were allocated to the team and advisors (15%), DAO reserves (18%), and also mining reserves (45%).
The INSUR token provides holders with voting power in the protocol governance and serves as an incentive for the participants in the InsurAce ecosystem. Capital provisions to the insurance pool and investment products are rewarded with INSUR tokens.
The InsurAce team is led by its founder Oliver Xie, who is also the head of MTR Labs, a company building solutions for WEB3 and its security. Most of the team members work at MTR Labs as well. For example, InsurAce product manager Shin Qu and marketing director Dan Thomson.
InsurAce was audited by Slowmist in February 2021 with two high-risk vulnerabilities found, and by PeckShield in July 2021 with only one high-risk issue found. Slowmist found that the revised smart contracts are under risk of reordering attacks - this issue has been fixed by the InsurAce team. The company also found that there is a missing permission check, allowing any user to call a function adding an owner - once again the issue was fixed by the InsurAce team. The high-risk vulnerability found by PeckShield was regarding a lack of token whitelisting within one of the functions in the reviewed smart contracts that is responsible for checking the denomination of staked tokens, the issue was fixed by the InsurAce team.
In August 2022, InsurAce announced a $12 million insurance payout to 155 victims of the Terra UST token crash.
Earlier in May 2022, InsurAce also paid out the Elephant Money claims after the exploit which resulted in Elephant Money’s stablecoin TRUNK de-peg.
InsurAce has partnered with PancakeSwap, UniSwap and SushiSwap, creating pools for users to stake or farm INSUR tokens. There are also numerous collaborations with various DeFi projects to offer their users insurance services to protect them against smart contracts and bugs. For example, InsurAce has partnerships with SpiritSwap, AutoFarm, and Mirror Finance. The full list of partnerships can be checked on the official project’s webpage.
The InsurAce team is working towards launching new insurance products, among which there will be insurance for NFT and metaverse projects. The team also plans to deploy on other EVM-compatible chains and present its updated tokenomics.