AMA RECAP — GainsChat x PolkaCover
Ayeley:
Today, we are joined by Kunal and Anthony from the Polkacover team. Let’s learn more about them and the company!
Kunal and Anthony, Welcome to the GAINS community.
We’d like to know what did you do before crypto, how did you get into crypto and did you have any other venture in crypto previous to being involved with Polkacover?
Kunal:
Sure. Anthony & I have been based in Dubai (UAE) for over 15 years.
Previously I have worked with multinational insurance companies (AIG & Allianz) in a senior leadership role building products and partnerships in the Middle East and Africa Region. In my last role, I headed the Retail Insurance industry for Policybazaar (an insurance company valued at over $ 1 billion with VC partners like SoftBank & Tencent) reporting to the CEO.
My experience has revolved around developing, building, and managing large-scale B2C insurance products & markets for more than 11 years.
My co-founder Anthony has been with Allianz Partners for over 4 years and is part of the strategic development team where he works on building third-party implementations, automation engines. and workflow for insurance partners and third-party providers in B2B & B2C environments. Anthony has worked on creating back end solutions for these insurance products, and we have also worked together on several projects for Allianz before, where we met.
We both got involved in crypto about 3 years back and there has been no looking back .. Our Tech Lead — Akshay Meher — Comes with several years of working in blockchain development and has worked with one of the largest banks in UAE in their DApp development. with his last stint being with Marlin Protocol working on Polkadot deployments in short !
We did not have any venture before but I have come from startup background where I built the Retail Insurance B2C insurtech platform from scratch for PolicyBazaar and was Employee no.2 there.
Ayeley:
That’s great. What’s your role at PolkaCover and what is the project about in a few simple sentences?
Anthony:
@Polkacover, We are building a one-stop crypto-insurance & one-stop market for traditional and decentralized insurance products and services to provide crypto users in the marketplace. mass college an option to protect their Crypto, DeFi & NFT assets
Polkacover connects users to our platform covercompared.com, which is then connected to different blockchains (based on the requirement) using bridges on the polkadot network for cross blockchain transactions. Once the user requests for an insurance quote, the data is fed into a smart contract which is connected to the insurance companies using oracles/third party API’s on the polkadot network. The information from the insurance company and the user data allows the smart contract to validate and issue the policies.
Kunal:
We would be a marketplace for other insurance providers as well as we developing our products through our insurance DAO platform as well .. A but of Hybrid model of traditional and decentralized options to bring the best of both worlds
Our products are targeted and early & retail crypto user base which provides against exchange hacks, Exchange bankruptcy, phishing attacks to name a few.
Ayeley:
What about other crypto companies. Are they left out?
Kunal:
No. In the longer run, we want to providers such as Nexus mutual, Cover protocol and aggregate their products as well. We would not be competing with them in product development if we have a provider who can give us specific coverage so Ideally the DeFi Insurance providers would be our partners not competitors
Ayeley:
Can you tell us how the retail user will use your platform? What will be the process if a member of the Gains community wants insurance, for instance. Do they have to complete KYC?
Kunal:
For the traditional insurance backed products, Yes.. KYC is needed as it comes as a requirement from the insurance provider.
However, the P2P Insurance version is being developed in a way that KYC would be needed only at time claims payout but not policy issuance.
So users have an option which way they prefer to transact
Ayeley:
What stage is the project at?
Anthony:
There are multiple development initiatives running in parallel, there is the development of the platform which is still in progress and in line with our roadmap, in addition there is also the product development side of the project where we are in the final stages of the products to be confirmed by the insurance companies.
We are hoping to share the details of our partners once we receive the final regulatory & compliance sign-offs form their end to make it “official”.
Ayeley:
How many people are on the team? And For how long have you been working on PolkaCover?
Kunal:
Currently we are a growing team of 8 which includes 3 full time & 2 part time devs, this includes our technical and marketing team alongside me and Anthony, in addition we have also partnered with Audace Labs as our technology advisors who we consider as part of our team as well.
The Idea for Polkacover was penned out somewhere early, and did a bit testing and market scoping for about a year.
We had been speaking to insurance companies to warm them up to crypto insurance product for about a year and when we finally received a positive response is when we announced the project a couple of months ago
Ayeley:
Did you raise funds so far? If so, how did you handle them? Are you planning to do any future raises?
Anthony:
Yes including the seed round and the Private sale we have raised USDT 1M and were heavily over subscribed with requested totaling over $5million ( We stopped counting &@ 5 Mill !!) , the Funds are being used in the development of the platform and the initial marketing push to fuel the growth that is required for the project to reach its potential.
We have a crowd sale planned for the 21st of Jan, however the sale is capped at $150K only, after which we would be listing our token on Uniswap to start with.
We are also in contact with a few additional exchanges on which we will be launching the CVR token
Ayeley:
That’s really impressive. How can we participate in the sale on the 21st?
Anthony:
The sale is an IDO on Polkastarter and you can register for the whitelist on our website https://www.polkacover.com/
Ayeley:
Thank you. We’ll bookmark that
What is the token use case? How did you make sure it captures the value of the ecosystem you’re building?
Kunal:
With regards to the utility, there are several use case where the token is used, a few of them are mentioned below
1) Crypto Insurance Policy Purchase — Customers would need to solely use our CVR token to buy any crypto-insurance product.
2) Policy Discounts — We would be also launching other lines of insurance ( such Life / Health & Travel). Users can also purchase using other cryptocurrencies, however, additional discounts and benefits are provided for users paying through the CVR token
3) Staking / Risk Assessment & Governance Rights –
Upon holding the CVR tokens in your wallet, users will be rewarded with the below
- APY’s in token
- Additional discounts on the policy purchase
- Free insurance products depending on the staked value
- Risk Assessment & governance right in our InsuranceDAO
- Risk Liquidity provider rewards
4) Claims Payout
All claims are paid out using the token. Customers can choose to hold the payment in the token or convert to Fiat currency. Incentives are provided to receive & hold the claim payouts in the token
5) Cross Border Policy Issuance
The platform will provide only Policies which allow purchase Worldwide which can be bought exclusively bought using our token and a few more which are mentioned in the whitepaper as well when you interact with the platform
With regards to the utility, there are several use case where the token is used, a few of them are mentioned below
1) Crypto in concerning the payout of claims.
Ayeley:
What are some measures that will be adopted by Polkacover to ensure that people don’t game the system just to earn free tokens
Anthony:
Everyone involved in claim adjudication will have their tokens staked to validate and approve any claim, this is then governed by a second layer by a governance body which will initially consist of the PolkaCover team and in case any bad actors are found violating the terms of adjudication their staked tokens will be burnt.
Ayeley:
Thanks for the answers so far. Let’s move on to the Twitter questions
The first question is from @cryptoenr1que
Polkacover will provide “global access” to purchase insurance products quickly and easily to its users. By that do you mean that your project has no geographical restrictions whatsoever? Any DeFi project and any user anywhere in the world can use Polkacover?
Kunal:
As we have several products in the pipeline, our initial focus is bring out products targeted at crypto currency users which is backed/underwritten by large traditional insurance companies. In the medium term, we are also building out our own P2P Insurance platform ( Insurance DAO ) where we would have additional products in there as well ..
A few of the initial products we are working on are
- Loss of crypto due to exchange hack
- Loss of crypto due to phishing attack
- Loss of crypto due token going bankrupt or project abandonment
We are also looking at NFT Assets by Impermanent Loss through our Insurance DAO
And yes, this will be provided to all crypto users to almost 120 countries ( barring US/Canada) to start with. The countries with a stringent regulation will be onboarded at a later stage.
Ayeley:
The second question is from @Emidm28
I read that you initially had built a POC on Ethereum a year ago, however, have migrated development to Polkadot. What were the reasons for this migration?
Anthony:
Yes That is correct, we were initially building the project on Ethereum, however the higher GAS fees and the clogged network was not the best for our product.
We are planning the platform to have a high level of daily transactions which would not be feasible financially to run it on Ethereum.
Our Dev team then went on researching other blockchain solutions which could support quicker transactions, low transactions cost and interoperability, which we believe Polkadot is the best suited for the project.
Ayeley:
Final question is from @NguyenQ32225128
You said that the P2P insurance platform of Polkacover is similar to Nexus Mutual in structure but very different in terms of product conditions. Tell us the difference and core advantages of Polkacover as compared to Nexus Mutual?
Kunal:
Yes. Our P2P Insurance platform might have similarities with Nexus Mutual “in structure” but the products are completely different.
We love that Nexus brought in the Insurance products into the crypto space and love the work they have done. We have been closely studying their model to see how we could improve the experience for the ecosystem.
However, our P2P model initially, the Governance team (PolkaCover) would be working with insurance underwriters (pricing experts) when we build out our initial products. Once there is enough experience & data of claims. We would hand over the pricing function to the community. This is just to ensure that the community gains the needed experience from experts to understand how risk assessment is done. Once the knowledge transfer is done, we would hand over all aspects of P2P insurance management to the community to make it work similar to a DAO.
This ideally reduces the risk of faulty product development and loss of funds by risk liquidity providers as well.
Ayeley:
How is your buyback and burn policy?
Kunal:
Once we go live, On every policy sold, 10% of the premium would go towards burning our tokens until we reach 70,000,000 tokens as final supply ( which is about 50% of the supply)
Ayeley:
Regulation is very important. Many projects were closed in many countries due to failure to use the correct regulations and permits. In order to go global how does the Polkacover team deal with these issues?
Kunal:
In terms of jurisdiction, although our Business team is based in Dubai ( and the tech team is based in India), the marketplace platform will be incorporated out of BVI to allow us(and the insurers) to be able distribute these policies to a global audience as Dubai does not allow such flexibility to distribute insurance products globally.
Most of the western countries ( barring US/Canada) will be available to purchase in the initial launch. As US/Canada is heavily regulated markets, we would look at adding them on at a later stage once we receive approval from the insurers & our legal advisors.
Ayeley:
PolkaCover provides several tokenized incentives making up to 40% cheaper than any traditional insurance channel. What makes this possible? How can it be 40% cheaper?
Kunal:
What we would be doing is using the commission/incentives received from the insurance partners and discounting it from the premium of the policy to build in the token adoption.
Seperately, our E2E API based setup reduces the manual transaction activity bringing down long term operational costs of running the platform
Ayeley:
If you say that you’re “The First DeFi insurance marketplace for the global crypto ecosystem” What is your marketing strategy and how do you think would attract more people?
Kunal:
Once we are closer to launch, We would running a mass market campaigns through our marketing partners/journals targeted at crypto users. We have built in the cost into our business model to manage the marketing activities needed for mass adoption.
Ayeley:
How many Insurance Companies are working with Polkacover right now? how many more and which ones would you like to add to your system this 2021?
Kunal:
We have reached to almost all Multinational insurance providers however, we have 2 who have warmed up and are supporting products around crypto to start with.
Separately, we are in contact with several reinsurers as well to get as many providers as possible by the time the platform is ready for launch.
Ayeley:
How does Polkacover differentiate itself and what plans do you have to overcome the first-mover advantage of other insurance platforms currently on the market such as Nexus Mutual?
Anthony:
Nexus & Cover have done great work for the defi insurance space , however, we are looking at mass-market products (Exchange hack) that would address a large base of crypto users…
Separately, we would be having several insurance providers ( instead of just one) which would provide a larger variety of options for the end-users to choose from in terms of product offerings as well.
Ayeley:
How will eliminating Middleman reduce insurance prices, making it easier for most users to access them? What are the key points you have worked on to democratize this access for all?
Anthony:
In the insurance industry, there are excessively high commissions that are paid to the middlemen or brokers, this causes the pricing of the products to be substantially higher than its actual risk price, we intend to reduce that by removing the high commissions that these intermediary are charging
Ayeley:
In the insurance industry, there are excessively high commissions that are paid to the middlemen or brokers, this causes the pricing of the products to be substantially higher than its actual risk price, we intend to reduce that by removing the high commissions that these intermediary are charging
Kunal:
Our main revenue stream, in the long run, would be from incentives received from our insurance partners for distribution.
And from our P2P insurance platform, would be from our operational fees we gain from managing the pools from a revenue standpoint.
For the token, there are several use case which can be read in detail our whitepaper which would build token adoption at scale
Ayeley:
Do you consider that the PolkaCover platform is user friendly? Do you have educational materials available for users?
Anthony:
The platform is developed keeping in mind that anyone can come and use it, hence the entire platform is very user friendly, intuitive and allows users to purchase a policy in the least amounts of steps required.
Ayeley:
How does one determine how much policies will be insured/paid for without the need for human interaction if all underwriting and claims are automated? Will there be some form of interaction from the team (or administrators) with the client? If so, is there no decentralized Polkacover?
Kunal:
Yes & No.
Initially, several aspects of the Policy issuance will have human interaction but as a knowledge base of processes gets created we have a long-term vision to automate the entire platform using machine learning functionalities in the long run of the platform.
All platforms are a constant work in progress to refine their services :blush:
Thanks for having us and loved the questions, the community really has understood the project well and loved the support
Please do follow us on our social media pages … We have a lot of announcements lined up
Follow us on our channels to be updated on all our developments:
Twitter: @Polkacover
Medium: PolkaCover.com
Telegram: https://t.me/polkacover
Website: https://www.polkacover.com
Namaste!
