How Our Insurance Pool Works

An insurance pool for everyone

Many communities within the Cardano ecosystem are self-insured — and pay damages to loyal members who have suffered losses because of negligence, impersonation attacks or Discord hacks. But right now, not everyone is lucky enough to receive such compensation, as achieving this status often involves having a continuous presence on social media.

Our mutual pool would be inspired by this approach, meaning multiple NFT and token holders within crypto projects will share risk and resources. Instead of a single entity maintaining a reserve fund, contributions from the community would be pooled together to create a larger fund that can be used to pay claims and cover losses.

The formula for success

For the insurance pool to operate successfully, the premiums paid in ADA must be higher than the total value of claims. Other overheads — including processing costs and licensing fees — also need to be taken into account.

Our mutual pool is not designed to be operated for profit. Slowing Pains will collect premiums, pay legitimate claims, and return any surplus funds back to the community. Initially, we have a target to perform a proof of concept on 2,000 policyholders for one year.