To meet the demands of the growing cryptocurrency sector, CHES Special Risk is introducing a new insurance solution for the industry.
Like any monetary asset, cryptocurrency’s risks need to be protected. In recognition of this, CHES Special Risk has been working closely with the London insurance market to develop the new product. With US$600 million (around CA$761.48 million) in capacity – the largest in Canada to date – the insurance covers cryptocurrency custodians. The insurable interest is the cryptocurrency private key held on a designated premise by a third-party custodian.
CHES Special Risk’s new product is developed for companies working within cryptocurrency and blockchain looking for risk transfer solutions either for themselves and their clients. It was also developed for financial institutions that provide a cold storage service, and for cryptocurrency exchanges and managers of digital assets.
The product’s standard cover includes physical loss of damage to the cryptocurrency private key, deliberate and dishonest acts involving the collusion of a designated custodian, and theft occurring directly as a result of the use of the insured interest by a person other than the custodian while said person is physically present within the designated premises.
Coverage can also be extended to key generation cover; deliberate and dishonest acts or omissions involving the collusion of designated custodians prior to the commencement of the policy period when the insured interests are not located within the secure area; and deliberate and dishonest acts or omissions involving collusion during the policy period when the insured interests are in secure transit.
In April, CHES Special Risk expanded its insurance solutions for cannabis businesses, with the addition of property and product contamination coverage.
