Web3 On-Chain Life Insurance with Once Assurance and RedStone Finance
One of the biggest gaps that desperately needs filling within the world of crypto, is insurance. Most times, when people discuss this topic, they are referencing capital protection insurance. What is not talked about as much though, is blockchain’s and Web3’s ability to bring upgraded, modern, decentralised life insurance policy making into the world.
In this latest Web3 collaboration, RedStone Finance will be working alongside insurer Once Assurance, to offer on-chain life insurance for their users. RedStone’s Oracle will be providing Once Assurance with government health data, and World ID for sybil-resistance.
Let’s take a closer look at how this will work.
— Worldcoin (@worldcoin) June 20, 2022
Once Assurance is an insurance DAPP and DAO which allows people to take out life insurance policies for themselves. Users are able to create what are know as Life Tokens, which are essentially NFTs of their life insurance. In the legacy world of insurance, traditionally a client pays their insurer a monthly premium, which in turn allows them to have payouts if unforeseen events were to occur.
For example, an individual pays $45 a month for their life insurance. If the worst were to happen, and the individual had a fatal incident, the insurer would pay out a predetermined sum of money (set out in the individual’s insurance policy) to the individual’s beneficiaries, as stated on the policy.
With Once Assurance, instead of paying a monthly fee, users are able to stake an amount of ETH, which insures them for a higher amount of ETH, in the event of the worst. This is monitored by a contract which is set up by an actuary. The amount staked goes into a liquidity pool and is in turn invested.
The user is then able to list this NFT on a marketplace. This becomes weirdly interesting when you consider that the holder of the NFT is considered the policy beneficiary at time of the insured’s individual’s death. If the insured individual does decide to list the token, then their identity is kept secret, but their age and country can be exposed.
In order for Once Assurance’s protocol to work, they need an Oracle.
The insured individual’s status is monitored through the country government death certifications. This is made possible, in a decentralised manner, via the use of the RedStone Oracle. Making API calls to government death data, makes it possible to know the insured individual’s status.
After the API call is made, the data is sent to the Once Assurance smart contract (that controls the life insurance payouts), and if the criteria is met, aka the insured individual is indeed deceased, then the smart contract pays out the policy’s insured amount to the wallet holding the Life Token NFT.
RedStone, which is built on Arweave, has been making improvements to its architecture constantly over the past year. Recently they announced their new and improved RedStone Finance Warp Contracts. Check out the details here.
And, if you would like to read more about just how the Once Assurance Life Token creation works, then have a look here.