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Risk Pools and Capital Efficiency
In order to pay claims capital is locked in Risk Pools
In order to guarantee that claims can be paid the risk platforms need to "lock" capital. The beauty of blockchain technology is that it's fully transparent how much capital have been locked against certain risks. Each Risk Platform has a different approach to "locking capital" which impacts the risk and price of the covers they offer. There are two goals which need to be carefully balanced:
Goal 1: Guarantee claims payout Goal 2: Increase the Return On Investment of the locked capital
Example:
In case a Risk Platform offers a protocol failure cover for 10 protocols and locked $1M in capital for each. Should the Risk Platform then allow only 10x$1M=$10M worth of assets to be insured? The answer is NO, As it's highly unlikely that all 10 protocols will be hacked at the same time. Hence the Risk Platform can look for Capital Efficiency which allows them to use the $10M of locked capital to ensure a higher value of assets.

Summarized overview

Each of the risk platforms has a different approach to staking the above balance.
Risk Platform
Available Cover
Claims payout
Nexus Mutual
Available cover generally 1-4x the staked amount per cover
(No risk pool can be larger than 20% of the total)
Multi-layer risk pool approach
Claims will first be paid from the staking pool of the specific cover
The second layer is the capital pool which contains 50% of the paid premiums
Bridge Mutual
{in progress}
{in progress}
InsurAce
{in progress}
Multi-layer risk pool approach
Claims will first paid from the "premium pool" (up to a maximum of 20% of the total pool). One premium pool exists per chain (BSC & ETH)
The second layer consists of the capital pools in which users can stake their capital (Each chain has a risk pool for each currency which can be used to buy covers).
The third layer are the capital pools of the other currencies which will be deducted using a weighted approach

Detailed overview per Risk platform