Reinsurance for Digital Asset Crime, Theft and Fidelity

Evertas provides reinsurance—insurance one insurance company purchases from another to insulate itself from the risk of a major claim event.

Reinsurance for Digital Asset Crime, Theft and Fidelity

One of the many insurance products that Evertas provides is reinsurance—insurance that one insurance company can purchase from another to insulate itself from the risk of a major claim event. Evertas’ contracts are written on A+ XV (Superior) paper, which meets the stringent compliance requirements of financial institutions.

Evertas reinsurance facilitates other insurers covering their clients against crypto and digital asset exposures, like physical harm, malicious damage, robbery and theft. It also provides coverage for theft (loss arising out of external factors or third parties) and for fidelity—employee theft, or theft when an employee is colluding with a third party. 

Evertas is empowered to deploy up to $360 million of crime / theft / fidelity coverage for digital assets on a single policy. This covers an entire platform with a single policy limit, and can accommodate cold, warm and hot wallets — though generally speaking, hot wallets are subject to a sub-limited coverage limit up to $10 million. 

Subject to underwriting review, Evertas can insure individual wallets up to $360 million per wallet for a segregated custodial wallet / vaulted platform on which the wallets are adequately segregated by physical location / vault, managing teams, hardware security modules, etc. This capacity could allow a single custodian to insure $360M of digital assets for individual customers’ wallets (e.g., Blackrock’s Bitcoin Spot ETF holdings). Generally, this would be proposed for cold storage wallets / vaults insuring against external crime exposures.

Reinsurance for digital asset crime, theft and fidelity is a huge market segment, and Evertas is early in being able to adequately respond to it. The technical underwriting required to enable such coverage demands a combination of base insurance knowledge and of the technology that underpins the risk. This highly specialized in-house underwriting expertise is precisely why Evertas is backed by Lloyd’s: our firm was created by and for the digital asset industry. Put simply, our industry-leading $360 million capacity is orders-of-magnitude greater than any of the competition.

The resounding approval by Lloyd’s after their due diligence process presents a significant barrier to entry for “normal” insurance underwriters committed to the legacy global financial system. Because of highly publicized failures like FTX, and because the crypto industry is perceived as competition to the status quo by most central banks and their regulators, traditional insurers committed to that legacy system are reluctant to engage with the crypto industry. 

Evertas reinsurance allows even these insurers to securely and comprehensively cover their cryptoasset holding clientele against digital asset crime, theft and fidelity.