Underwriting
The Underwriter
Can be anyone, even projects themselves.
Provides Collateral (USDT) on the risk-taking side of the Policy Book.
Underwriting whitelisted Policy Books yields DEIN tokens.
They are, additionally, jointly entitled to 20% (for whitelisted, 80% for non-whitelisted) of all Premiums paid for Policies against Policy Book in exchange for providing Collateral.
The individual yield rewarded to an Underwriter is proportionate to the collateral they provided to a Policy Book, and their chosen lock-up duration.
Upon a successful Claim, the Claimant is reimbursed with Collateral provided by the Underwriters, up to their Policy Size. Underwriters share in the loss proportionately to the amount they contributed to the Policy Book.
Where can I see all Policy Books and their APY?
Head over to (LINK TO GET INSURED MAINNET)
What risk do I bear when underwriting a Policy Book?
Suppose a claim against this Policy Book is approved. In that case, you might lose some or all of your funds in the Policy Book, depending on:
The Claim(s) payout amount(s)
% of your contribution to the particular Policy Book
How do I gauge the risk level of a Policy Book?
A good indicator of risk is the Utilization Ratio of the Policy Book (expressed in %)
A high Utilization Ratio implies that many users are willing to take insurance against the project, and few are ready to underwrite it. Hence the project can be considered risky.
A high Utilization Ratio also indicates that more of the Underwriters' Collateral is at risk. If a Policy Book has a Utilization Ratio of 50% and all policies bought against the Policy Book are claimed and approved in full, 50% of the Collateral in the Policybook will be distributed to Policyholders (Claimants).
On the flip side, high utilization ratio Policy Books charge higher Premiums and generally have much higher APYs.
Please do your own risk assessment before putting money in any Policy Book.
What are the benefits of Locking my funds?
Choosing to Lock your funds adds a bigger weight to your position, which translates to bigger reward share. Here are the exact multipliers for each Lockup Duration:
No-Lockup
x1
3 months
x2
6 months
x3
12 months
x4
24 months
x5
What if I don't want to Lock my funds?
That's perfectly fine! You can just choose No-Lockup option when Underwriting. You will still earn rewards, however they will not be increased by any multiplier.
What is the difference between a Whitelisted Policy Book and a non-Whitelisted one?
The Whitelisted Policy Books are verified by the DEIN DAO, they are eligible for DEIN token rewards and tend to have higher APYs. You are safe to assume that they cover reputable projects with correct contract information (such as the insured address, chains, or Policy Terms). Their Premium distribution is: 20% to the Underwriters, and 80% to the DEIN treasury.
The non-Whitelisted Policy Books are not verified by the DEIN DAO and are not eligible for DEIN token rewards, they only distribute the Premium provided by the Policyholders. Their Premium distribution is 80% to the Underwriters, and 20% to the DEIN treasury.
Non-Whitelisted Policy Books don't necessarily automatically mean they are not safe to use. You should however do additional research and double-check everything before choosing to underwrite them.
What does the "saturation" of the Policy Book mean?
Saturation represents the relation between the given DEINxCover token and USDT.
A 1:1 saturation means that 1 DEINxCover token is worth 1 USDT.
The Policy Book's saturation can change only due to a claim payout or premium distribution.
USDT rewards come from Premiums paid by the Policyholders, which increases the saturation. Underwriters can claim the USDT yield by exiting the position and converting their DEINxCover tokens to USDT at the saturated rate.
How is the APY of a Policy Book determined?
There are two components to the yield which Underwriters can earn:
Premiums from Policy Holders
DEIN rewards for staking DEINxCover
The following section is dedicated to Underwriting rewards in full:
šRewardsLast updated