Nsure Network is an open insurance platform for open finance. Nsure Network works like an insurance company that is governed by Nsure stakers. By taking a risk from an individual, and spreading that risk around a community, the individual is able to get their risk in the open finance covered.
Nsure is designed to allow anyone to become an insurance issuer for the DeFi (decentralized finance) sector. While conventional insurance depends on the issuer’s judgment on claims, Nsure rids these unequal judgments by employing smart contract oracles. The project borrows the idea of Lloyd's London, a marketplace to trade insurance risks, where premiums are determined by a Dynamic Pricing Model. Capital mining is implemented to secure the capital required to back the risks at any point in time. A 3-phase crowd voting mechanism is used to ensure every claim is handled professionally.
Capital Pool (Capital Mining)
The Capital Pool is an important business module of the platform to support business development. Nsure tokens are be rewarded to capital providers of the pool. For each Ethereum block produced, 2 Nsure tokens are distributed proportionally to all capital provided.
The tokens rewarded could be used to 1) stake on the projects and earn premium; 2) hold to enjoy the benefit from the growth of the system and leverage provided; 3) sell in the market to realize the profit.
When the surplus pool is unable to cover the Minimum Capital Requirement (MCR), withdraw transaction of the capital pool will be frozen until the drop of MCR, which may result from the expire of policies or the coming of new funds. When the surplus pool cannot cover all the claims, the capital pool will be used to pay the rest. The Capital Model is used to monitor the systematic risk, and give capital pool attractive risk-adjusted return.
An insurance contract is generated whenever the user purchases one or more insurance products. The insurance contract stipulates the insurance risk, the insurance amount, the date of insurance, and the corresponding premiums. Users can use ETH, Nsure, USDT, Dai, and USDC to pay. The insurance contract will automatically take effect after payment.
The policyholders will also share a small portion of capital mining. When the contractual payment conditions are met during the insurance periods, the platform will automatically initiate a compensation request, and NsureDAO will initiate one or more voting decisions to decide on the grant compensation.
The surplus pool will accrue whenever an insurance premium is paid. 40% of the premium will be added to the surplus pool. Another 10% will be reserved till the expiration of the contract. If there is no claim, it will add to the surplus pool. The surplus pool will grow over time and will be utilized to cover insurance claims first. When the surplus pool cannot cover all the claims, the capital pool will be used to pay the rest. When the surplus pool grows large enough, the mining speed will slow down. The community can vote to use the surplus pool to repurchase Nsure tokens for token burns.
NsureDAO governs key parameters of Nsure Network, such as type of product issuance, community claim assessment, and profit pool rewards. Additional governing parameters can be proposed by the DAO vote. Users are able to stake Nsure tokens, vote with their staked Nsure, and provide capital to the network. Users who participate in the governance voting will be able to collect rewards from the protocol. Nsure will also be awarded to users who provide capital to the network.
Part of the insurance premium is automatically into the profit pool when the insurance contract expires. Nsure holders can stake and vote in NsureDAO to distribute bonus issuance from the profit pool.
Nsure Network Roadmap
- 2020 Q1 - Whitepaper V0.1 release
- 2020 Q3 - MVP ; Liquidity Bootstrapping
- 2020 Q4 0 - Alpha release: capital mining, cover purchasing, leveraged staking claim payment
- 2021 Q1 - Mainnet V1.0 release
- 2021Q2 - Nsure DAO support, community governance
- 2021 Q3 - Bootstrap on the multichain ecosystem; e.g. Polkadot
- 2021 Q4 - Developing strategies to deliver greater returns to Nsure holders
Nsure Staking (Underwriting)
Nsure holders can stake on different projects to earn 50% of the premiums at a linear release. The overall staking power is determined by the Capital Model, which takes into account the correlation between different projects. Nsure holders can choose to stake on un-correlated projects to obtain leverage on their capital, thereby earning more premiums. The overall insurance limit offered from a particular project is 2 times the value of the total Nsure tokens stake on it. More Nsure tokens stake on a project, the cheaper the cover price will be.
If there is a successful claim, 50% of the claim amount equivalent Nsure tokens stake on it will be burned proportionally to share the loss. Staked tokens are locked from withdrawal and transfer, and the request is needed to release the lockup. There is a minimal 30 days unstake lock time. Some tokens might be locked longer if there was not enough insurance cover expired within 30 days. During the lockup period, Nsure tokens will still be awarded and if there is a claim that needs to be covered, the pending tokens will still be burned out proportionally.
- Jeff Ren - Management & Research
- Alex Peng - Insurance Model Design & Actuarial Analysis
- Leafan Chan - Lead Developer
- Alvaro Fernandez - Strategy & Growth
- Jessie Wang - Insurance Model Design & Communication
- Vincent Bauwens – Marketing
- Gary Lattanzi - Partnerships & Operations
- Anne Shuai - UI Designer
- Aaron Fang - Full-Stack Developer
- Based Ventures
- AU21 Capital
- Caballeros Capital
- Signal Ventures
- Mechanism Capital
- Genblock Capital
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