The Community Fund is presenting the following proposal from community member Chris Comrie for the community’s consideration.
The traditional insurance markets are ripe for disruption due to lack of adoption of new technology and large inefficiencies. I propose a community grant to evaluate how Nexus Mutual could compete with and disrupt traditional insurance markets.
According to Statistica, the market size for Property & Casualty and Direct insurance is at an all time high, up to $694.27 billion in 2020.
If Nexus is able to capture just 0.01% of this market, it represents a $69 million per year opportunity. If we can capture 0.1% that’s $690 million, and if we capture 1% that’s a $6.9 Billion dollar per year opportunity.
For the community members unfamiliar with traditional insurance markets, the property and casualty insurance market includes insurance for things like fires, hurricanes, earthquakes and floods to buildings and homes.
Up until now Nexus has provided cover mostly for crypto assets but has many advantages outlined in the white paper to traditional insurance companies that can make us more competitive than legacy insurance companies to provide cover on more traditional assets. We most notably have lower operating costs due to higher efficiency which could allow us to undercut the market and take a share of the profits.
I propose a grant to evaluate how Nexus could offer cover on more traditional assets starting specifically with earthquake insurance due it’s high premiums, low market capacity (meaning fewer competitors and higher demand), and relative ease of evaluating and paying claims.