DeFi insurance protocol InsurAce maintains it was well within its rights to reduce the claims period for anyone affected by the Tera USD (UST) Daypag event from 15 to seven days, and that it had already done so for almost everyone.
There were 173 claims submitted, and $11 million will be paid out.
A consequence of the failure of Terra and UST
Following the May 13 collapse of the Terra (LUNA) layer, InsurAce caused a stir by declaring that it will cover anybody involved with Anchor (ANC), Mirror (MIR), and the stablecoin Terra USD (UST). The claim window has been shrunk to its tiniest dimensions. -1 Blockchain of Bitcoin
InsurAce (INSUR) is the third biggest insurance provider for decentralized finance (DeFi) protocols, with a market cap of $15 million.
According to reports, UST had decreased to $0.08 by May 13 and CMO Dan Thomson told Cointelegraph on Thursday that the decision to restrict the claim window for 234 Terra portfolio covers was necessary to minimize further losses.
The move led to a debate in the crypto community, with some suspecting that InsureS was attempting to reduce the number of claims they would have to pay.
FatMan is a Terra Research Forum member. Told His 52,000 Twitter followers stated InsureS had done “a nasty move” and that the company should not try to “rip away” its customer agreements on May 24.
ALSO READ – Crypto Asset Managers Going After Profitability With Latest Investment Products
Thomson also stated that the procedure may look into processing claims for the remaining 61 unfiled covers.
The failure of Terra and UST has piqued the interest of regulators around the world, prompting the reactivation of the legendary South Korean financial crime team “Graeme Reapers of Yeoi-do” to investigate whether Kwon or the Luna Foundation guard (LFG), which manages Terra’s finances, committed a crime.
If UST de-pegging was not just a protocol failure, Thomson noted that InsurerS may have legal recourse. “I’m sure Terra and LFG have more important things to do,” he said, “so when we get there, we’ll cross a bridge.”
Source: https://www.thecoinrepublic.com/2022/05/27/if-terra-collapses-insurace-will-pay-millions-to-claimants/