Polygon Mainnet Launch: Stage 3, Purchasing Policies going live!

7 min readNov 23, 2021

NSURE NETWORK will conclude its successful migration to Polygon Mainnet, launching the 3rd and last stage. Users will now able to purchase policies for the available products on the Nsure Marketplace.

Dear Nsureans, it’s been a long journey since we first launched Mainnet on Ethereum, and today one of the most awaited milestones in development is becoming a reality: From tomorrow, November 24th 12:00 AM UTC onwards, users can officially purchase insurance coverage for dedicated Polygon protocols in the Nsure Marketplace!
To purchase insurance, you can access the marketplace via https://polygon.nsure.network/#/cover/my

Overview

Policies can be purchased in the marketplace with $MATIC, by requesting a quote for the desired product.
Enter the amount to be covered and the desired time period for the coverage, and a quote will be issued according to current pricing in the marketplace.

In the event of an exploit, policyholders have the right to submit a claim that will trigger a claim resolution process managed by assessors in order to trigger a payout.

Below is a detailed dive-in on all you need to know in regards to purchasing a policy, including a full manual on how to navigate through the app.

Here’s the anticipated list of the first batch of Polygon-based Protocols that are being offered coverage by the Nsure Marketplace, according to previous Governance consensus:

Policy Structure:

All policies sold in the marketplace are intended to protect against exploitability in regards to smart contracts that users may be exposed to. This includes events such as bugs, hacks, flash loan attacks, or any attack directly resulting in an unintended usage of the Designated Smart Contracts insured.

Policies are based on a proof of loss principle, under which coverage will supported on a case-by-case basis, based on the outcome of an exploit resulting in a realised loss for users that hold an active policy. Proof shall be submitted via claim processing, under which assessors determine veracity of the event and loss, triggering payouts.

We strongly suggest users to read up on our published policy wording to dive into the guidelines that mark the scope of coverage in possible situations. These are published under our Documentation here: https://docs.nsure.network/nsure-network/docs/nsure-smart-contract-protect-policy-wording

Policy Pricing:

Analog to the Ethereum marketplace, policy pricing is determined via Dynamic Pricing Model for each product. The cost of insurance varies across products in the marketplace depending on supply and demand in real-time. A risk parameter is included into the equation to price in adjusted risk for each protocol.

Dynamic Pricing Formula

This results into price behaviour to be dictated by both, the demand for insurance policies sold (active) vs the supply given by Underwriters to back up these risks.

Lets look at the supply & demand curves closer:

Supply is given by Underwriters, by staking Nsure tokens into products. These lower the price of an insurance product marginally as the amount of staked tokens increase.

On the other hand side, price is set to increase with every additional policy to be active within the system:

Demand is determined by purchasers that are acquiring policies. Assuming no variance on the supply side is given by Underwriters, the premium rate is set to increase as displayed above.

Overall, the higher the amount of Nsure tokens staked into a product to back its risk, the less volatile a product would become towards changes in demand.

The Risk parameter takes care of the riskiness embedded in each project. It is based on the rating we given for each project. In the pricing of traditional insurance, similar factoring exists called underwriting tier, which is applied to the base premium rate. Without the Risk Adjustment Factor, premiums of 2 projects would be identical if their capital demand and supply are the same, which is unsatisfactory since the difference of riskiness in the 2 De-Fi may not be equal. By multiplying the risk factor, we are basically evaluating the risk by capping the premium rate.

In order to dive deeper into the Dynamic Pricing Model, we suggest to read up on the published documentation here:
https://docs.nsure.network/nsure-network/docs/dynamic-pricing-model

Claim Process

With the successful purchase of an insurance policy, every user has the right to execute a claim proposal in the event of an exploit to trigger a payout.
Once submitted, a distributed claim assessor committee will participate in the claim resolution process, incentivised by premiums and vetted by staking tokens to participate in the assessment.

The policyholder is responsible to provide adequate and substantial evidences that he did suffer a genuine loss on the designated project within the period of insurance. The proof of loss must include following 2 component:

Prove ownership of affected address

After identifying his affected account, the policyholder may prove his ownership over the account via signature or making a 0 amount payment to a specified address.

Evidence of loss in the exploit

The more evidence provided by policyholder over the loss, the higher chance such claim will be accepted by claim assessors, especially the below materials closely relevant to the loss

Here’s an overview of the claim resolution process to be followed:

Model for claim processing, resolution and public-vote challenge (if needed)

Every claim resolution based from Assessors’ decision will be given a period under which the public can vote to challenge the result, in case of differed opinions on the decision. This acts as a public verification filter which will allow for any erroneous or malicious activity to be prevented and mitigated, ensuring proper functionality of claim payouts.

For further info on claim processing, please read on our published documentation:
https://docs.nsure.network/nsure-network/docs/claim-process

The portal for assessor- and claim processing can be found under:
https://claim.nsure.network/

For Polygon-based claims during the initial stages of being live & processing, 2 alternatives are being considered: 1) Direct engagement on claim assessment & voting via snapshot directly after providing proof via IPFS 2) Integrating claim portal to become cross-chain for both Ethereum and Polygon (further stage).

User Guide

Step 1: Go to the Purchase section and select the target protocol by clicking Quote.

Note: Security Rating is an indicator of the smart contract risk level for each protocol. By influencing the risk factor used in the pricing, Security Rating impacts the cost for policies of each protocol.

Type in desired time period and amount to be covered to obtain your quote

Step 2: Input your desired policy duration and coverage amount. The price estimate will show up for your reference. You can also check the graphic at the top which displays at all points in time what the historical daily average price for the last 180 days / since inception of the product.

After clicking Get Quote and approve the contract, you complete the purchase.

Type in desired time period and amount to be covered to obtain your quote

Step 3: Check your policy status in Purchase section -> My Policy page. You can monitor all your active/expired policy together with the policy claims and mining status.

Under Purchase section, click My Policies and go to the policy dashboard

We sincerely hope you enjoy the latest feature release and are thrilled to be bringing you this milestone for usage to Polygon participants in the Nsure Network marketplace!

About Nsure Network
Nsure is an open insurance platform for Open Finance (DeFi). The project is inspired by Lloyd’s of London, a market place 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 of time. To learn more about Nsure Network go to Nsure.Network or follow us on Twitter or Telegram.

For private inquiries or collaborations, please DM any of our admins or contact contact@nsure.network