Whitepaper 2.0 tl:dr

The current insurance industry isn’t working

Giant corporations dominate a multi-trillion-dollar insurance industry. Insurance remains an indispensable part of the modern economy and is a critical society’s safety net.
However, the industry is not working for:

  • customers:

    • the insured: when they need help the most, they can struggle to get reimbursed by corporations whose profits rely on investing customer premiums and not paying out claims.

    • the underinsured: millions of people are missing out on life-changing insurance benefits because policies are too expensive, intransparent and inefficient.

  • insurance providers:

  • wrestle with trading off shareholder (generate profits) and customer interests (pay out claims), making them marginally unattractive to both have high operational costs as they need to collect, analyze and store enormous.

  • customer/industry data sets in huge private silos in proprietary ways new entrants face a high entry-barrier due to complex regulations, reducing the ability for disruptive innovation.

  • investors:

    • customer premiums (risk pools) are very attractive investment instruments, however, they remain inaccessible to most investors or customers themselves.

Blockchain will revolutionize the insurance industry

  • Blockchain smart contracts:

    • completely cut out many processes, radically reducing coordination (and therefore policy) costs.

    • use pre-defined claims payout criteria and publicly available data (parametric insurance) to eliminate conflict of interest, human error and increase transparency/trust.

    • can fully automate claims/payout handling resulting in near-real-time payouts.

  • Blockchain tokenization:

    • democratizes investment access to other customer premiums (risk pools)

    • enables access to new investment vehicles and markets (including crypto), which are usually inaccessible to non-professional investors.

    • allows customers to benefit from investment returns for their insurance premium.

Etherisc is the future of insurance

Etherisc’s open-source blockchain platform is a growing ecosystem, benefiting for.

  • customers: who can easily access innovative, cheaper, faster, more transparent insurance.

  • insurance providers: startups, large/small companies or non-profit groups can quickly and easily offer high-quality, innovative parametric peer-to-peer insurance products.

  • investors: can benefit from a broad range of risk-based investment bundles (trustless risk pools), tailored to their risk/investment appetite.

GIF (Generic Insurance Framework)

The Generic Insurance Framework (GIF) is the core of Etherisc’s multi-chain, multi-tenant decentralized insurance platform:

  • open-source smart contracts that implement generic insurance product and policy lifecycle functions across the complete value chain.

  • oracles provide necessary data (e.g. flight or weather)

  • product-tailored end-to-end execution environments (GIF instances) covering products, oraclesa nd risk pools.

Etherisc offers insurance providers:

  • ready-to-use modules to quickly & easily design fully-compliant and licensed insurance products.

  • a transparent, real-time, structured overview of all building blocks, events and transactions available in a GIF instance (GIF monitor).

  • high-quality code audited by two independent reputable businesses

  • a new legal model which removes most insurance company’s legal and financial requirements by exchanging a claim for a technical guarantee (certain countries only).

Etherisc’s governance ensures that the protocol continues to improve and can be used freely.

  • Etherisc’s Swiss-based foundation (DIF) formally holds the IP rights of the protocol.

  • DIP is Etherisc’s token, which participants need to join the ecosystem: Hardcap of 1 Billion (10^9)DIP, of which 30% (300M DIP) were distributed during 2016’s token generating event, the remainder is held in the DIF treasury.

  • Use of the ecosystem is governed by the Etherisc Governance Model (EGM), bound by a set of rules and principles.

  • GIF instances are certified by the DIF, registered in the token curated registry and set up as DAOs.

  • Participants are required to stake their DIP tokens to be able to enact their EGM voting rights.

Etherisc’s economic principles

  • development and maintenance of the platform, EGM and GIF instances are intended to be self-sustaining and not profit-oriented.

  • whilst providing high-quality, competitive products for customers, each GIF instance is intended to generate profits for participants.

  • participants need to stake their DIP tokens to be able to invest capital (staking stable coins) in primary risk pools.

    • contain customer premiums and investment capital to cover tail risks

    • claims are 100% collateralized (i.e. sufficient capital to pay out all claims)

    • invested capital is at risk and can generate attractive returns depending on claims frequency/severity (e.g. no claims = high profit, high claims = no profit).

    • staking assets in the risk pool mints an NFT, which is automatically purchased by a secondary risk pool, which fractionalizes it into ERC20 risk pool tokens (RPT).

    • specific RPT are minted for each risk pool and tradable on the open market.

    • any profits are paid out to token holders at the end of an ‘epoch’ through the increased value of their RPTs.

    • insurance providers also benefit from risk pool investments through staking. They must also pay a regular fee to cover the EGM’s operational cost and stake in governance pools for voting rights.

So what are you waiting for?

A fair and truly decentralized ecosystem that protects the unprotected and welcomes everyone to be a part of it. Want to be part of an ecosystem of cheaper, faster and more transparent insurance? Join the revolution today and say hello to insurance 2.0!