New York startup Assurely
announced a new
insurance product offering, CrowdProtector, to cover Security Token Offerings (STO) and other types of crowdfunding. For issuers, the product provides cover for investor complaints and lawsuits. For investors, they can potentially get their original investment returned where there is bad behavior by the issuer. That includes misrepresentation and misuse or theft of funds.
“This solution demonstrates the value of insurance in helping opportunities move forward. New crowdfunding practices are proliferating today” said Dan Kumpf, Chief Underwriting Officer, Global Professional Lines, at AXA XL. “Without proper coverage, millions are at risk. Our work with Assurely is a great example of innovation in the industry. Collaboration between incumbents and innovative InsurTech startups such as Assurely, will yield a positive result for the industry and advance it as a whole.”
The cover is only offered in the event of a successful funding, but investors don’t need to apply. And for the issuer, they only pay after the fundraising and the premium is dependent on the amount raised.
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