Superscript, a U.K. startup and Lloyd’s of London insurance market broker, has launched a dedicated product for crypto businesses.
“Daylight,” as the new insurance offering for digital-asset firms is called, begins with technology liability and cyber insurance, which serve as protection against everything from ransomware attacks to unintentional copyright infringement.
In recent years, cryptocurrency and insurance have been uneasy bedfellows, with a shortage of capacity in the market and many large crypto exchanges simply opting to self-insure, holding reserves of bitcoin (BTC) to cover their losses, typically in case of a hack of “hot” wallets, or those connected to the internet.
Superscript, which was part of last year’s Lloyd’s Lab accelerator, said the first crypto businesses in line to buy tech and cyber cover are Argent, Chiliz and CEX.
“As well as protecting the actual physical digital assets, there’s a whole other world of risk that also needs to be covered,” said Superscript digital assets lead Ben Davis in an interview. “So, if a platform goes down ... there are privacy breaches, ransomware attacks, breaches of contract, copyright and IP infringement. All that needs to be covered for crypto companies to move into the mainstream.”
As of 2021, there were just 350 brokers licensed to deal with Lloyd’s. Superscript says it’s the first Lloyd’s broker to provide a digital assets dedicated product; Lloyd’s-approved coverholder status was granted to Evertas earlier this year. (Lloyd’s policy is not to promote individual products and therefore it did not provide a quote for Daylight, a Superscript representative said via email.)
That said, Lloyd’s is slowly but surely coming round to crypto, according to Davis. “I would say the winds are changing a little bit for Lloyd’s in terms of digital asset risk,” he said.
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