An Overview of Lloyd’s New Crypto Insurance
Lloyd’s of London, known for their extensive history in the insurance industry, has made headlines by introducing a unique liability insurance policy specifically designed for cryptocurrencies held in hot wallets. This innovative policy was developed in collaboration with Lloyd’s syndicate Atrium and crypto security firm Coincover.
Policyholders can acquire coverage starting from as low as £1,000 (around $1,275) and have the comfort of knowing that their insurance limits adapt in tandem with the volatile nature of cryptocurrency prices. This means that rather than being locked into a fixed amount, your coverage dynamically changes to mirror the fluctuating market values.
How It Works
The policy offers a dynamic limit, which adjusts based on real-time value changes in the insured crypto assets. So whether Bitcoin takes a wild rollercoaster ride or Ethereum decides to do the cha-cha, your insurance will keep pace, ensuring you’re indemnified against theft or loss at all times.
The Rising Demand for Crypto Insurance
With more people exploring the world of cryptocurrencies, the demand for insurance covering these digital assets has surged. Matthew Greaves, an underwriter at Atrium, emphasized this rising appetite among investors attracted to crypto’s allure.
As David Janczewski, CEO of Coincover, observed, “With the crypto-asset market heating up at the start of 2020, a new wave of crypto-curious customers are ready to jump in—having been previously deterred by insufficient theft protection. This cutting-edge policy helps eliminate those concerns and broadens crypto’s appeal.”
Lloyd’s Track Record in Crypto Insurance
Lloyd’s is no stranger to the crypto game; their journey began back in August 2019 when they partnered with the crypto custody platform, Kingdom Trust, to provide insurance. Recently, news surfaced that BitGo, a blockchain security company, is gearing up to offer crypto insurance through Lloyd’s as well, potentially covering up to $100 million of assets.
In a similar move, the Winklevoss twins have launched Genesis Exchange, introducing an insurance policy to cover up to $200 million specifically for their institutional-grade crypto custody service. This is reportedly the largest insurance amount ever offered for a cryptocurrency custody service globally.
The Future of Crypto Insurance
The growing recognition of the need for insurance in the cryptocurrency sector marks a crucial step toward mainstream adoption. As the industry evolves and more companies like Lloyd’s make strides in providing reliable protection, we can expect a bustling marketplace that welcomes investors with open arms.
