Development of blockchain and cryptoassets being held back by concerns over insurance
Evertas, the world’s first cryptoasset insurance company, says the lack of a robust insurance market is hampering the adoption of cryptoassets and blockchain infrastructure. It warns this is limiting mainstream adoption and regulatory acceptance of cryptoassets and blockchain infrastructure.
Figures (1) released today by Evertas reveal that last year just over half (55%) of insurance executives it interviewed believed companies were holding back on developing blockchain initiatives and crypto assets because they couldn’t insure their activities here effectively. Only one in five (20%) of those interviewed disagreed with this view.
Furthermore, 87% of insurance executives interviewed said they felt directors and senior executives are at risk of being sued if the organisations they work for suffer losses or thefts linked to their blockchain and cryptoasset activity, and they didn’t /don’t have adequate insurance in place.
When asked how effective they think organisations are in assessing the risks posed to their crypto asset storage and blockchain systems, only 20% of insurance executives believe they are ‘effective’. This helps explain why 35% of insurance executives interviewed said they thought there was a ‘high’ chance of cryptoasset or blockchain related insurance claims being rejected because the risks involved were not properly assessed or recorded when insurance was taken out.
Raymond Zenkich, President and COO, Evertas said: “Cryptoassets are increasingly becoming mainstream. This trend will be further fueled by more traditional and illiquid assets being tokenized, making it easier to trade and invest in them. There is increased use of smart contracts for owners and investors in these assets to interact with counterparties, and increased acceptance of blockchain as core infrastructure across industries to record ownership, provide an audit trail, and unlock completely different business processes and applications. However, for this market to really reach its full potential, it must be supported by a viable insurance market.
“This is an exciting business opportunity for the insurance industry. Clients will increasingly expect them to understand the risks associated with cryptoassets and blockchain, and to provide them with relevant cover.
Notes to editors:
(1) Evertas commissioned research company PollRight survey 51 senior insurance professionals in 2019.
For further information please call Phil Anderson at Perception A on 0044 7767 491 519.
Evertas is the world’s first cryptoasset insurance company. In February 2020, the company rebranded from BlockRe which was founded in 2017.
Evertas has a world-leading team led by an experienced group of executives including the founding Chief Insurance Officer (and founding member) of Lemonade, blockchain team leader at Bank of New York, and a blockchain industry insurance expert. Their backgrounds bring together an unrivalled cryptoasset/technology expertise with pragmatic and practical insurance industry expertise.
The founders of Evertas have over 40 years of combined experience in the insurance sector, and more than ten in the crypto and blockchain markets.