German reinsurance giant Munich Re has announced that it will provide reinsurance capacity and technical underwriting support for the digital asset insurance product – OneInfinity.
This comes after Munich Re announced that it has entered into a three-year strategic partnership with virtual insurer, OneDegree Hong Kong Limited (OneDegree) to launch the product, which makes OneDegree the first licensed insurer in Asia to collaborate with a global leading reinsurer in offering digital asset insurance.
In a press release released by OneDegree, it saids that OneInfinity is an insurance and technology product offering designed specifically for digital asset trading platforms, asset managers, custodians, and technology providers.
OneInfinity bundles OneDegree insurance with Cymetrics’ solutions – a separate product that is offered by a sister company of OneDegree.
Cymetrics helps companies examine cyber, blockchain and digital asset risks from the perspective of hackers and insiders in a more agile and flexible way.
Furthermore, with the rapid and mass adoption of digital assets, the global market value of digital assets surged to a record high of US$3 trillion by the end of 2021.
The press release stated that to ensure the community’s sustainable growth, a key strategic priority shared by Web3 builders, operators, participants and policy makers to build a compliant and secure Web3 ecosystem by “establishing and adopting best practice in risk management.”
But, because of a lack of insurance capacity, this has not only put Web3 practitioners at greater risk, it has also hampered institutional investors’ participation too.
One of the key reasons for the lack of insurance capacity globally is the scarcity of data and expertise to underwrite risk related to digital assets.
Authorized by the Hong Kong Insurance Authority as a virtual insurer since April 2020, OneDegree has quickly established itself as the leading virtual insurer in the Hong Kong market by number of paid users.
The company’s tech DNA gives them a competitive advantage in the digital asset space because it can “combine strong underwriting expertise with sophisticated data analytics and technical know-how.”
In addition, by partnering with Cymetrics, OneDegree can also offer advanced cybersecurity capabilities to clients too.
OneDegree said: “OneDegree has leveraged these unique strengths, as well as its inter-disciplinary knowledge of blockchain technology, risk management and compliance, to optimize OneInfinity for the end-to-end providers of digital asset services.”
OneDegree also stated that it is excited to have been selected by Munich Re as their digital asset partner, after passing the reinsurer’s rigorous due diligence. Howden RE’s Hong Kong team supported OneDegree to establish this important partnership.
Greg Barats, Senior Executive at Munich Re and President & CEO of HSB, a Munich Re Group company, said: “We are looking forward to teaming up with OneDegree as a key partner for our digital asset initiative. OneDegree is a digital native insurance player, that is part of an innovative group of tech companies. Accordingly, this partnership allows us to be optimally positioned to serve the important and expanding digital asset market.”
Alvin Kwock, Co-Founder of OneDegree, added: “We are delighted to work closely with Munich Re to offer OneInfinity, a market-leading digital asset insurance product. Digital asset insurance is set to be the gold standard serving the Web3 community.
“Regulated insurance coverage is a strong signalling effect that supports trust and credibility of the insured entities. OneDegree is privileged to be Asia’s first insurer to contribute to the secure and compliant development of Web3.”
Helen Ye, Chief Commercial Officer of OneDegree, also commented: “This partnership is a game changer. With Munich Re’s support, OneInfinity offers much needed protection to the Web3 community. More importantly, both OneDegree and Munich Re have invested resources in building a digital asset native team and now we will join hands to deepen and broaden our understanding of the full spectrum of risks relating to end-to-end digital asset operations.
“We are confident that the partnership will contribute to establishing best practice in risk management for the digital asset industry. By doing so, we believe our product and technology offerings will be another step forward in enabling the fast-growing digital asset industry to unlock value and potential.”
Becky Tam, General Manager of Digital Asset Insurance in OneDegree, also added: “This is the insurance sector with one of the highest entry barriers because of the technical inter-disciplinary knowledge required. As a digital native insurer, OneDegree is uniquely placed to leverage such knowledge, as well as our insurance-based analytics capabilities, in creating this innovative product offering.
“We are thankful to all the industry players from the digital asset sector, blockchain service providers and cybersecurity experts to provide valuable advice for us in building the product. We are especially glad to partner with Munich Re to bring reinsurance capacity and expertise to answer the ever-growing demand.”
