Lloyd’s of London has introduced a new insurance policy in partnership with Welsh cryptocurrency startup Coincover. The policy is designed to protect cryptos held in online wallets against malicious hacks and theft.
Coincover is a fintech/insurtech startup in Cardiff that enjoys comprehensive support from the Welsh Angel Investors and the Development Bank of Wales. The partnership will provide the safest way for consumers and businesses to purchase, hold, accumulate, transfer, and spend cryptos, according to Businessnewswales.com.
Reports confirm that Coincover is the latest contribution to Wales’ thriving £8.5bn tech economy. The startup has officially launched a crypto-insurance product to the market after enjoying a strong pick-up in the beta testing phase.
How it works
The investment is backed by a consortium of prestigious Lloyd’s of London insurers, which is led by Atrium. This groundbreaking offering is a first-of-its-kind liability policy that insures cryptos stored in online hot wallets.
However, it has a dynamic limit that increases or decreases depending on the price changes of the crypto assets. The official announcement read:
“As the crypto-asset market heats up again, a new wave of crypto-curious customers is standing by at the ready to jump in, having previously been put off by the lack of adequate protection against theft and loss. With this innovative new policy, we can remove these barriers and broaden the appeal of crypto. It represents another step forward in enabling cryptocurrency adoption.”
The insurance underwriting of this product is a massive achievement for Coincover with Cardiff and Wales positions at the forefront of massively thriving digital asset revolution.
Currently, Coincover is working with an international business customer base of IFAs and banks, asset managers, crypto exchanges, and private wealth managers. The firm plans to support over five million end users on the platform by the end of 2021.
Growth and development
Currently, crypto is a $250 billion market worldwide. The crypto asset market will be worth $27TN by 2027, according to a projection by the World Economic Forum.
More than $40 billion of cryptocurrency assets have been lost through loss of hardware wallets and digital keys, theft, or death of the digital key holders since 2010. With Coincover, all these scenarios are covered entirely by insurance.
The startup is the first and only provider of crypto wills, which guarantees that investors’ next of kin can retrieve crypto investments in case of death. A Senior Broker at Prospect, James Gadbury, said:
“We are delighted to have provided Coincover with this new insurance cover, which demonstrates the innovative and entrepreneurial spirit of Lloyd’s. We believe Prospect and the wider insurance market should support this rapidly developing sector as it moves into the mainstream.”
The Welsh digital economy employs almost 45,000 people, with the main hubs concentrated in Newport Swansea, Cardiff, and Wrexham. Universities also support the industry by producing about 7,500 computer science and engineering graduates annually.