Insurtech Lemonade has formed the Lemonade Crypto Climate Coalition, which will offer services to agribusinesses from the most vulnerable corners of the world.
The coalition included Lemonade Foundation, Avalanche, Chainlink, DAOstack, Etherisc, Hannover Re, Pula and Tomorrow.io. In joint communication with clients saysthat the coalition is being created in the form of a decentralized autonomous organization (DAO). Primary focus: Weather insurance services for farmers and livestock keepers in developing countries. Initially, the insurance system is planned to be tested within a year on the African continent.
Climate insurance is being designed as a decentralized application (dApp) denominated in stablecoins and deployed on the Avalanche proof-of-stake (AVAX) blockchain. Farmers will be able to pay for the service and receive insurance premiums using a mobile application, similar to how they make banking transactions.
The Lemonade Foundation will provide seed capital to support the DAO smart contracts, and over time, any crypto investors will be able to participate in funding the DAO liquidity pool. It is planned that the organization will issue a governance token to reward community members.
“Using DAOs instead of a traditional insurance company, smart contracts instead of insurance policies, and oracles instead of settlers, we look forward to leveraging the shared and decentralized aspects of Web3, as well as real-time weather data, to provide accessible and instantaneous climate insurance.” says Lemonade Foundation director Daniel Schreiber.
It is expected that at least 300 million African farmers may be interested in LCC insurance services.
Rose Goslinga, co-founder of Kenyan insurance company Pula, says that “most people face real climate risks that deprive them of their livelihoods, as traditional forms of insurance based on indemnification may not be available to them.”
In 2021, Hong Kong-headquartered insurance agency OneDegree offered its services to Asian crypto companies to help market participants avoid risks. According to OneDegree, the company is partnering with Hong Kong-based cryptocurrency exchange HKbitEX.
Source: Bits
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