Insurance Solutions for Digital Assets: WTW's Strategic Acquisition of Redefind

Brokers and insurers are actively exploring the digital assets market as cryptocurrencies and blockchain technologies gain momentum. This exploration comes despite challenges related to volatility, regulatory concerns, and the intricacies of insuring crypto-related risks. Reflecting this trend, WTW has acquired Redefind, a digital platform that provides insurance solutions for owners of cryptocurrencies and digital assets.

This acquisition signals a growing industry initiative to craft insurance products for digital asset-related risks such as theft, fraud, cyberattacks, and recovery of stolen assets. As institutional and corporate engagement in digital finance expands, there is a parallel increase in demand for insurance solutions reminiscent of those in traditional financial sectors.

However, the digital asset sector poses significant challenges to insurers. Issues such as regulatory clarity, valuation, and the frequency of cyber incidents have historically tempered insurers' enthusiasm for underwriting in this space. Additionally, the constantly evolving nature of digital assets introduces complexities in risk evaluation.

Brokers are seeking out specialized expertise and technology platforms to better serve clients with the appropriate protection and recovery services. Redefind, acquired by WTW, is equipped to assist digital asset owners in cases of theft or loss by covering costs related to forensic investigations, asset tracking, and legal recovery efforts. Initially, the service will launch in the UK with plans for future expansion. Redefind’s founders, Richard Daws and Connor Edward, have joined WTW following this transaction.

Industry Shifts and Strategic Expansions

Alastair Swift, head of global specialties at WTW, noted an increasing demand for regulated insurance solutions as digital assets gain mainstream acceptance. "As digital assets continue to move further into the mainstream, demand for credible regulated protection solutions is increasing," Swift commented. "Through this investment, WTW is taking a leading position to shape the future of risk transfer and protection in the digital economy."

This development is part of broader efforts by brokers, insurers, and Managing General Agents (MGAs) to understand the impact of emerging technologies on risk and insurance demand. Alongside advancements in areas such as artificial intelligence and cybersecurity, digital assets are attracting significant attention from specialty market participants seeking growth opportunities.

In response to market needs, insurers have introduced products covering aspects like cryptocurrency custody, digital asset theft, cyber exposures, and director and officer liabilities within the digital asset space. Similarly, brokers are expanding their advisory roles in emerging technology risks as clients seek expertise in these developing markets.

Anthony Borgman, head of GB Affinity at WTW, remarked on the strategic nature of the Redefind acquisition. "We are delighted to have acquired Redefind and welcome its founders to WTW," Borgman stated. "Under Richard's stewardship, the business will continue to evolve with support from WTW's Affinity practice and for wider distribution."

The deal aligns with WTW’s broader strategy of investing in technology-driven and emerging-risk solutions. An example is the launch of Digital Infrastructure Protector, tailored for data center owners, and the planned acquisition of Newfront, expected to bolster WTW’s technology and digital distribution capabilities.