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Welcome to the podcast hosted by the Association for Women in Cryptocurrency, sponsored by

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Bracewell LLP. Bracewell is a leading law and government relations firm whose award-winning

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teams lead the market in cutting-edge transactions and litigation, regulatory matters, and government

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relations. You can learn more at Bracewell.com. Today's topic is super sexy, crypto insurance.

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Learning in everything you would want to know about the industry and why it's important.

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The Association for Women in Cryptocurrency is a global professional network of women

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and male allies around the world who advocate for the equitable inclusion of women in the

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future of digital finance, blockchain technology, and Web3. The views of the speakers are their

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own and do not necessarily represent those of the association, its sponsors, or its

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board of directors, or their employers. This podcast is our opportunity to showcase the

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incredible work being done by our members around the world in the crypto blockchain and Web3

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industries. I'm your host, Amanda Wick, founder and CEO of the association, and I'm incredibly

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excited to introduce you to today's guests, Cara Owens and Sarah Downey. Cara Owens is

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an advisor for proof and part of the reinsurance team at Stone Ridge Asset Management. Her

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previous roles include underwriting and risk management leadership roles at a Fortune 500

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insurance company, Markle Corporation, and the largest reinsurer in the United States,

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Trans-Re. She's on the board of the longest running women's insurance association, APIW,

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the Association of Professional Insurance Women. Not our older cousin, but could be,

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which I love.

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Sarah is the Lockton US Financial Services Head of Operations and Blockchain Digital

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Assets Advisory Leader. As the Blockchain Digital Assets Advisory, or LEAP, Lockton's Emerging

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Asset Protection Team Leader, she's focused on positioning Lockton as a trusted advisor,

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thought leader, and solution developer for ensuring Blockchain and digital asset companies

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and the risks they face. Lockton has successfully placed insurance coverage for a number of

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Blockchain companies, including trading platforms, exchanges, lenders, decentralized finance

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companies, mining companies, wallet providers, market makers, liquidity providers, investment

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managers, asset managers, private equity venture capital firms, custodians, payment platforms,

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Blockchain technology incubators, NFT platforms, and others, possibly including an association

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for women in cryptocurrencies. We are incredibly excited to have these two subject matter experts

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here and ITs about insurance being sexy because, like I told you guys in the prep call, my

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parents used to do insurance. I grew up on this. If you don't think it's sexy, I promise

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you by the end of this podcast, we're bringing sexy back to insurance, or at least crypto

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insurance. Let's just jump right in. Ladies, can you tell me, I covered that you're from

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Lockton and Proof. Sarah, if you want to start, just tell us who Lockton is and then

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Kara want to hear from you too. Yeah, sure. Thank you, Amanda. Lockton is an insurance

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broker, so we don't actually provide insurance to companies, but instead we're the middle

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man, we're the facilitator. We work with all types of companies. My team works with companies

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in the digital assets space. We help companies understand their risk exposures and then we

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help them find the right insurance carrier partners to transfer those risks. And we're

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lucky enough to get to work with insurers and MGA's like proof. You literally stole

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the words out of my mouth, but Kara, please go ahead and tell us who proof is. Thank you

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for having me here and Sarah, it's always great to see you. We're always low working

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with Lockton. Proof is on the insurance providers. I know, and I did want to say Sarah, instead

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of a middle man, Lockton's a middle woman, we should start saying. So true. I thought

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that. I love that you said that. I was like, when can I get that in there? And Kara's

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like, fall or see. But proof is on the other side. So we work with Sarah as a broker. We

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are an actual insurance provider, so we are taking the risk on, we are providing insurance

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policies to a number of digital asset companies. We also provide insurance policies to other

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emerging tech providers like AI and robotics as well. We're up to five million in policy

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limits. We're a subsidiary of Stone Ridge and Stone Ridge is an affiliate of NYDAIC, which

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is a Bitcoin-focused financial services business. And we'll get into some of the different types

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of policies and companies that we're working with later.

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Yeah, I think I live as a former prosecutor. Sarah knows this, I say all the time, but

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I live in a world of analogy and metaphor just because that's kind of where you have

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to live explaining things to jurors. But in my experience, I think most people don't

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think about this, but they've probably experienced in the form of homeowner's insurance. And

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I had a complicated 100-year-old home brick house in Missouri that I had to go to a broker

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for because if I had just called 100 different insurance companies asking if they would ensure

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a 100-year-old brick home in an earthquake zone, that would have been a giant waste of

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my life. And instead, I could call a Sarah who said, let me just call the person I know

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who does that and save you tons of hours of your life. And so at its basic function when

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I met Sarah, I was like, oh, I understand that. I had an insurance broker for my home,

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and so I think it's an easier model to understand that it's just kind of at the corporate level,

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at the business level, at certain types of policy levels. I think it's really relatable.

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I'm just curious because I know my parents' origin story, but I'm curious about yours.

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How did you guys get into the insurance industry?

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I'll go first here. I'm a bit of a weird one. A lot of people sell into the industry.

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I actually majored in risk management insurance, which is extra nerdy. I didn't mean to, to

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be fair. I went to Temple University in Philadelphia in order to graduate with a degree. Is that

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where your parents went?

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I was literally about to say, you are the reincarnation of my mother who has this identical

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origin story who went to Temple University undergrad with my dad and literally chills

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her running down my spine because I'm like, this is going to be like the tales of my childhood

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when she would tell me the exciting stories of risk management and how it was the coolest

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profession ever. And I'm like, I am so here for this. This is amazing.

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I definitely need to meet your parents. I'm very excited about that. In order to graduate

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with a business degree, you had to take the intro to risk class and the professor was

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amazing and we had to do a case study and I got to do risk management. We picked the

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New York Yankees as our company, which is technically by not a company, but we had to

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do risk analysis of what could happen to the New York Yankees.

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And then one of the insurance companies travelers gave me a scholarship and I was like, all

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right, this sounds like a great major. I get to assess the New York Yankees and I get free

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money. So I rolled with it and then had a few different internships throughout college

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and ended up accepting my first full-time job at a re-insurance broker in New York City.

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I think anytime that you can say the words in your career, free money and New York Yankees,

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you are doing something right. You are on the right path. I would have followed that

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path as well and I'm not even a Yankees fan, but I do love daytime baseball and hot dogs.

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So, Sarah, what about you? How did you get into it?

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My story is not nearly as sexy as Kira's, but I thought I was going to date myself by

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saying they didn't have insurance classes in college back when I was there, but clearly

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I'm wrong. I am totally not your typical insurance person. I actually am a lawyer by background

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and after I graduated from law school, the career counselor at my law school introduced

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me to a friend of hers who was a practicing insurance attorney and so I just ended up

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falling into insurance. I practiced law for nine years, mostly on the insurance claim side

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of things, also doing a ton of coverage litigation. So in court all the time, which just was the

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best. That was a super cute love of mine. Practiced for nine years and then actually

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moved over to an insurance broker where a couple of years into that I actually started

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doing the digital assets. I fell in love with it. So more to come on that.

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As a recovering lawyer as well, I empathize with all of that. And I actually have a friend,

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Monica Parker, who used to do coaching for attorneys who didn't really like the law part

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into getting to other things. And I always told her she was like a decade ahead of her

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time because it was hard to do that back then. It took a lot of courage to say, I'm going

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to take this law degree that I spent oodles of money on and do something else. So I'm

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always super impressed with people who had the bravery to do that earlier. Not that it's

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like you should do it, but when you feel like the inclination and you make something amazing

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out of it, it's a beautiful thing that I don't think people realize is actually a little

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hard because of how well trod the lawyer path is and how difficult it is to kind of climb

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out of it against and swim upstream instead of down.

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I like the coverage litigator to risk matchmaker. Yeah.

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Is that right? I think it's a natural thing. I mean, Sarah, tell me if you're wrong, but

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I hear this a lot. You see this a lot, especially from like, at least in my experience with

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M&A attorneys or finance attorneys who spend so much time on like the litigation side.

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And then they're like, well, I could do the finance side and be really good at knowing

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what not to do wrong because like I put these deals together. And so I've seen people make

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that move from like the lawyer aspect of the business side to the business side. And it

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does take like a certain kind of extra entrepreneurial spirit and business sense that a lot of lawyers

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don't necessarily get training in or don't naturally pick up on. So I always kind of

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say, I feel like those people are like lawyers plus, you know, it's like they had a legal

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acumen, but they actually had enough business acumen to be able to do both well.

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The interesting thing about you guys is that you're both not just an insurance, but you're

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kind of in like the crypto insurance space, which is obviously why you're on a podcast

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called Women in Crypto. But how specifically did you get into like digital assets? And

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is there anything different or exciting about the digital asset space compared to maybe

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the other spaces you used to be in?

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My story, it's a long story, so to chat is short in it. I was at a competitor of Lockdyns

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for seven years and I started there as a claims attorney. So never really left the law side

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of things, but we formed a group. I think it was back in 2017. So, you know, we decided

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we needed to understand blockchain technology and cryptocurrency and was just an area as

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a broker we needed to follow and invest time in. And so we formed this working group and

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a couple of weeks in, I saw my boss's boss at the time in the hallway and I went up

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to him and I said, look, I have a job already. I don't want to be part of this group because

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I could see that it wasn't going to succeed. It wasn't going to do very much. There was

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no structure to it. And he said to me, he said, you're going to meet you a week from

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now in my office and you're going to tell me you're leading our digital asset team.

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And I said, no, no, no, I already have a job. I'm a claims attorney here. And he said, no,

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no, no, I'm telling you a week from now, you're going to tell me you're leading the team and

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needless to say he is quite compelling. And a week later, we were actually in a conference

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room and it was decided that I was going to lead the digital asset team back at my prior

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employer. And it was the best thing ever that boss's boss is now my direct boss here at

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Locked In and I followed him here. And I thank him all the time for pushing me to do something

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that was outside of just my normal selves because what really excites me about the space

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and it is very different than working with traditional companies, everyone is so creative

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and innovative in the digital asset space. And there's this feeling of China, for the

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most part, trying to work together to help the ecosystem fries. Traditional companies

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are a little different because they've been around for so long. So you don't have that

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newness and freshness. And so to me, the digital asset space is just the best, best space to

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be in.

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I think you summed that up so well. And I wish people could see our heads nodding like

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Kara and I are just like bobbing like up and down, absolutely. But I hear that so often

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from so many different corners of the ecosystem. I think people don't understand that's why

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so many of us love to work in this industry because even those of us that say we're crypto

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agnostic and we're enthusiastic but cautious, underlying all of that is a constant impressness

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or enjoyment of a bunch of people who are at least willing and open to have the conversation

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of is this a better way? Is there a better way to do this? Can we make things better?

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And I think that is such a heady thing to be around that it's why so many of us love

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it. And we talk about it all the time in the association that no matter what role somebody

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has, it's what bonds us as an industry and why crypto blockchain Web 3 is so different

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is you could be BD, you could be insurance, you could be a lawyer, you could be a founder,

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but we're all in this to steal airy redboards term, the cryptoverse together, like building

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things and you can feel that it's like it's palpable. But Kara, what about you? Was it

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like Yankees to Coinbase or was it just a straight line?

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Mine's a little bit of a definitely a zigzag of a kind of line where I was lucky enough

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to join Stone Ridge and Stone Ridge has a city area with proof. We're actually just starting

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proof when I joined. So I was helping to write the policy forms and when I work with a proof

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team, I'm very much learning every day. And at Star Point, we're a very creative industry

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and it's more exciting working with the digital assets space and what I'm looking at other

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industries that are not as exciting and kind of been around for a long, long time. But

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yeah, I was lucky enough. I am definitely not a crypto expert. I know more than the

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average person, but I am learning a ton by working with everyone at proof. And there's

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just a lot of crypto knowledge throughout all of Stone Ridge and we used to have a Bitcoin

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fund and we also have a sister company with IDeg.

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You touched on something where you said it's like a really creative industry. And I think

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people don't understand or appreciate that about insurance. They think insurance is really

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boring. And going back to something that you said earlier about your risk management class,

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I was probably one of the few kids who had a mother that would tell stories about how

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exciting it was to do worst case scenario planning in risk management. She later went

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on to become the first risk manager of the University of Pennsylvania. I mean, my mom's

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story is like incredibly inspirational, but she's the ultimate nerd, which is one of the

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many, many reasons that I love her. But she would do this thing where she would say, you

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know, in risk management, you just imagine you're walking along a sidewalk. Is the sidewalk

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wide enough? Like what if somebody slipped and fell? What's on the side of it? Does it

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cushion them? Because if their face plant hits and they knock out their front teeth,

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you're paying for those teeth. So what does the sidewalk need to be? And I'm like, what

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does life look like like that? Right? But it's just such a fascinating thing that there's

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like these people who think of these things. And I think in tech, people don't necessarily

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think about insurance. But I guess my question to start off, and one of the reasons I was

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so excited to do this podcast is I would love for both of you to explain why insurance matters

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so much, especially in an industry like this.

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I mean, I think it's protection when you need it the most, right? Usually if you're going

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to have an insurance policy paying out, it's one of the darkest times of your life, but

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something's going wrong, right? And you need somebody to be there to help you out. It's

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not just a payment. It's also, it depends what your, what kind of policy you're buying.

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So cyber, for instance, is a lot of risk management and prevention going on. So the cyber insurance

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care will actually work with the broker and work with the insurance to make them a safer

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risk and to make sure that they're going to be, or potentially not have a ransomware

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attack happen when it could have happened because they were so insecure. So you can

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help them to actually become a safer company and prevent something from happening or say

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something doesn't have happened and a cyber attack happens, then you're working with them

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after the fact as well. So you have a number of different vendors that are helping to see

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what exactly happened from a cyber attack side and try to mitigate it as much as possible

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so the loss isn't so big. But if you think of not even cyber, but just like hurricane,

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like any company doesn't have to be a digitalistic company, but you have some terrible event that

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happens and then the insurance companies are there to help out in that time of need. I

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think it's just definitely something that's needed in society and it keeps small businesses

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in business and it keeps personal individuals ability to rebuild their home. So their insurance

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is important so many different ways.

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I think people have a tendency to be conditioned like you mentioned hurricanes. I'm from Southwest

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Florida. My parents house is actually still not done from the hurricane that hit back

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in 2021, I think 2022. But it's interesting to me how in some ways we're conditioned to

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be very aware of these very obvious things like weather events, right? Like, oh, absolutely,

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this is going to happen and I need to have hurricane insurance and flood insurance and

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homeowners insurance. And of course I need to have car insurance. Most states require

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it, right? And so I think we're conditioned in some ways where we've been told worst case

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scenario planning.

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But I think for businesses, it's really hard to envision every horrible thing that could

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happen, especially if you're like a founder and you're thinking about all the positive

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possibilities and you're just so focused on moving fast and breaking things and you have

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no idea how much those things cost if they break. And funny enough, to your point, I

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did a LinkedIn post last year when my stuff was stolen in Madrid. I was homeless for two

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days, lost everything, laptop, phone, wallet, everything, get home and somebody was like,

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well, did you file a claim with your renters insurance? I was like, why would my renters

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insurance? Wait, what? It didn't, it turns out, right? Renders insurance like ended up

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covering so much of it. And I didn't even think that it would cover something like that.

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And it made this horrible thing in my life actually end up being kind of like, it was

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wildly, wildly helpful. So I tell people sometimes like a failure of conditioning to do good

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worst case scenario planning. And that's why a lot of us don't appreciate insurance until

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sadly we need it. And if you're lucky you have it and you file a claim and if you're

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not lucky, you kick yourself in the butt for not having it.

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And I think this is especially true in this industry. I think one of the challenges is

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the lack of understanding about how valuable insurance is. So speaking specifically to digital

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assets back in like 2017, 2018, like one of the first claims we saw come in, which no

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one else at the time knew about were these SEC investigations into the crypto exchanges,

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which did start way back in 2016, 2017. And the founders of these exchanges at the time

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were so new to this space and they never expected to kind of find themselves in the crosshairs

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of the SEC. And then you fast forward to today where you see enforcement proceedings come

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out of those investigations that have been going on for years. And so insurance really

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is for that rainy day where something really bad happens. You never think it's going to

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happen to you. Unfortunately, it kind of always does in business at some point, something's

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going to hit and that's what insurance is for. But there are other amazing reasons why you

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buy insurance too. Like if you want to bring on experienced officers or directors to help

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run a company, chances are they know about insurance because insurance for them is a

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form of personal asset protection. So if they get sued, they're not going to want to pay

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their lawyers. They're going to want either their company to pay or insurance to pay.

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So that's another great thing that insurance does. And then it's also, I mean, the products

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themselves are great, but it's also in this space especially, it's become a form of like

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third party validation. So you take a custodian, for example, they go through this extensive

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underwriting process, they come out of it with insurance coverage that they can market

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and tell their customers they have. And if they've gone through this extensive vetting

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process and now been vetted by yet another third party, that kind of makes everybody

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more comfortable about. So insurance does so many things and serves so many purposes.

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I've told so many people, I'm like, just have a call with Sarah and just like, just tell

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her what you do because I remember that conversation where we had like, where at the very beginning

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I was lucky to have an amazing board. And one of them said, so we have DNO insurance,

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directors and office insurance. And I was like, I'm sorry, what? And then, of course,

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quickly we got that. And then I remember talking with you where we were like way into the process

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and you were like, well, who do you have your general liability policy with? And I was like,

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general liability. And she's like, don't you say you put on events around the world in

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spaces where people could slip and fall or choke on crudité. And I'm like, I never thought

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that it's just the things that you don't think about. Right. And look, I'm a lawyer running

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an association. What do I know about all of these things? And people are like, well, don't

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lawyers know everything? I'm like, lawyers are the worst, trust me, the worst. But it

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is just interesting that, and this is where I go back to the conversations with my mom.

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It's a thought process, right? Like lawyers are taught to think a certain way, but nobody

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I've ever met does worst case scenario planning and hypothesizing like risk managers and insurance

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people. And it's a magical thing when you can have that conversation. They see things

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that should be obvious to you. But there's a lot of people who came into financial services

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or DeFi or CFI and thought that that five part wouldn't be any trouble. And the most

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heavily regulated industry in the world would like not need any insurance protection. And

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Sarah, to your point, I'm sitting here thinking some guy opened an exchange and didn't think

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he needed to insure against the agencies that might come after him like seriously. But that's

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my lawyer hat saying that seems like obvious risk, but we just don't see what we don't

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see, right? And you guys somehow are like, Oh, I see it all. I see risk and yeah, I

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could go down that rabbit hole for hours. But yeah, every news story I look at and I

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want kind of product line with an insurance to this day. What insurance policies could

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it trigger? And now that you say that, I'm like, wow, that would probably pretty bit

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nerdy because that is like what I think about it. I think that translates for nearly every

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profession is that it teaches you how to think and see tend to see things through that lens.

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And so I find that the more people I can talk to with different lenses helps me see so many

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different aspects and facets of a thing that it's just exponentially more helpful, which

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is why I was so excited to meet Sarah because I was like, Sarah, save me for myself. I'm

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pretty sure that there are things I'm not seeing. And I refuse to ask my mother because

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I don't want to have another conversation with my mom where she's like another aspect

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of your life where you did not do sufficient risk management. Exhibit A, leaving your things

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in a club in Spain. But this kind of leads into like a really good discussion of like

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the mechanics of how this works in the sense that, you know, Sarah, you mentioned your broker

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and, you know, carry your insurer. And I think people don't realize like the many layers, the

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truffle like or no, parfait nature, if you will, or onion like layers, how things with layers

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that you guys have, like I don't like the process I think is a little opaque to some people.

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So break it down like how does buying a pot like what is the process? I mean, I know that's

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sometimes covered in entire books and entire courses. But if there's a TLDR version of like

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how does buying a policy work, like hit us. Yeah, we can totally make this easy. The process

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really is pretty straightforward. You come to an insurance broker, all US insurers, or most of them

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can't deal directly with a company. They have to, the company would have to go through a broker.

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So you come to a broker, depending on who your broker is, like we spend a lot of time asking

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you questions about your business and really trying to help you understand where your risk

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exposures are because a lot of companies think they know, but then they are missing something.

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And so that's a process just kind of talking through what your exposures might be, what your

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priorities are. Do you want to save money? Do you want broader coverage? What it is that is kind

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of top of mind for you? And then we talk about the different insurance products that are out there.

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If something's not out there that fits your needs, we create something like leave it or not.

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Insurance is a creative space. And then depending on what type of insurance is, either you just

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compete in application and the broker submits it to the insurance markets, it's as easy as that.

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You turn around a quote, or if it's a little more complicated, like drivers and officers,

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liability insurance, cyber insurance, we would still submit an application or some relevant

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information. And then you might get on a call with the insurance markets and tell your story

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about your company, answer questions. We as a broker totally track you for those who are right

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by your side. No uncomfortable question is ever asked. And then you get a quote, and then you

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decide what you want to buy. So it's really not a complicated process. So proof would work with

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Sarah, would locked in and sit with the insured through those calls. And if it is that Sarah said

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it's a complicated company or complicated like cyber, then proof is going to come up with a list

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of questions on top of what the application questions are. And sometimes it might take

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us a little bit of back and forth. There's sometimes those questions to be easily answered just

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on the call. Yeah, there's a little bit of more due diligence on the underwriting side,

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if it is more complex. And you guys mentioned like you kind of sit with these companies,

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but what types of companies are you working with? Like, I mean, I know I read off just a laundry

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list. Maybe it's more helpful to say what companies do you not work with because it felt like everything

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was on the list for locked in. But like, is it literally the realm of any type of company?

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And for proof, there's nothing that's on target companies like token issuers,

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software infrastructure, asset managers, miners, validators, some non-tech service

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providers, custodians, payment providers. So I mean, the list can keep going on. I don't think

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there's any necessarily red, red flag company. We would like to look at everything, but there

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are some where we think it might be too risky to take off. Wait, wait, who are those? Don't make

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a cray answer. Who are the two risky? Oh, and now we move into the spicy part of the episode.

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Sarah, standpoints, don't take any anybody, right? Well, we still have a reputation

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tip or type, but we will work with any type of company. Like in addition to everything that

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was on that laundry list, and I apologize because I did not realize how long that list was.

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If we work with protocols, we work with DAOs, like the more complicated or newer type of

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risks that are out there, well, really, from our perspective, we love learning. And we love kind of

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like taking this crypto language and converting it to plain English when we go back to the

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insurance market. So even what is newer, like a DAO, we can kind of present it in a way that

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isn't so new and scary to companies like proof. Well, and I assume it's kind of like crypto

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as a whole in the sense of there was always going to be some matter of amount of risk with everything.

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And if you have somebody to educate you through the process, right? If we had more consumer

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education, the risk wouldn't be as bad. It's just without somebody to kind of educate you and walk

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you through that process, risk takes on an exponentially greater threat than if you have

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somebody who's giving you almost like informed consent or information on how to handle the

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risk. Like you can make an educated decision about how you handle your risk if you're educated

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in how it works, which to me, I think has always been the broker role. I don't know if you see it

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that way, but it always felt like somebody that kind of walks you through the... I'm not necessarily

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here to tell you proof like company A versus company B. I'm here to tell you like benefits of A,

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downsides of pros and cons of A, pros and cons of B. Here you can make an educated decision based

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on the facts, right? And I think that's the great thing about a broker and that's what crypto needs

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a little bit more of. So it's why I'm excited when we can get in front of the crypto industry

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people who help educate make those informed decisions. And on the insurance company side,

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it's super helpful that proof has an in-house expertise and are able to leverage that.

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The expertise at Ninding and Stone Ridge to make more comfort level, to make us have a more

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concrete level with crypto companies, I think for a while, traditional insurance carriers

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kind of stayed away from crypto because they just didn't know enough about it. So proof single is

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really we know a ton about it, we know how to assess the risk. And also now we're starting to

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look at other areas like AI and robotics where some insurance companies might not want to put

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the extra effort into learn a ton about it. So they might be staying away from it, but we think we

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have a leg up on really doing some additional research to be able to provide capacity and

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provide insurance policies within those different areas. Yeah. And I was just going to say, I agree,

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Amanda, I think it is a brokerage responsibility to kind of educate the market. And there's a

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handful of us, I don't even think it's more than a handful of us who are like, who are true crypto

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insurance brokers who have been doing this for a long time. And we've always seen it as our

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responsibility to be part of that education process and to facilitate it. Like I know that we have

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had huge meetings where you invite all the carriers to come in and you invite either clients or

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lawyers, regulators just kind of give their viewpoint on things just because the education

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piece really is so important. Now the education piece works two ways. It is a large part of it

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is educating the insurance markets, helping distinguish client from client. But it also

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works on the part of us as brokers educating our clients as to what each type of insurance does,

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what each carrier specializes in, who pays claims, who doesn't. It's the education process works

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four ways. That's a perfect lead in to what I was thinking in my head, which is like,

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so what do you tell if a company comes in, what do you tell them about why and when should you

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buy insurance? What is the discussion? How do you help them kind of broaden the aperture of

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seeing their risk of when insurance needs to be there? So as a broker, I mean, honestly, we have

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that anytime a company calls to have that conversation, we're ready. We work with startups

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all the way to the exchanges here, been around forever now, kind of where the old school players

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in the space. And they all need insurance. Even a company that just started some, for startups,

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obviously cost tends to be a priority in such a different conversation. The business coverages

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like general liability insurance, those are the really important ones for startups. And then as

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they grow, we want them to be prepared to understand when D&O should be on the radar, when cyber should

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be on the radar. And Kara can speak to this, but quite frankly, when it comes to cyber insurance,

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a lot of startups, their cyber hygiene is not quite where it needs to be yet, but they grow into it.

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And with the help of a broker and with the help of a market like proof, we all give feedback as to

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what proper cyber hygiene should look like or proper D&O governance should look like so that when

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a company decides that they want to spend the money on protecting their balance sheet, they know

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what they need to do and they can work towards already having everything in place. And it really,

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the feedback has been amazing. Like, I truly appreciate what the information they learn from

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dealing with the insurance markets and a lot have incorporated that feedback into their daily

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operations. And sometimes they need to buy from a contractual standpoint as well in order to work

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with some partners, especially for cyber and then errors and emissions policies often they need a

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certain amount of coverage in order for another company to feel comfortable working with them.

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And I think the cyber side, definitely some of the startups sometimes need a little bit of help.

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But I feel like they're better than startups that are not within the digital office space because

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you tend to have very tech savvy people at these companies that have a technology background. So

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I would say some of the crypto companies are more secure and more knowledgeable around cyber than

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what you would see outside of that space because you do tend to have just more tech savvy people

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there. Well, and I would assume now, right? Post hacks and all of that. I mean, we've had some really

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bad lessons that hopefully people have learned from and don't want to be the next version of.

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So that's encouraging to hear that's going in that direction. And, Kara, you mentioned,

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actually both of you have mentioned a couple of terms and we don't want to assume that

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everybody who's listening to this had parents that got into insurance. So you mentioned directors

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and officers or DNO. I think you mentioned ENO, like errors and emissions and cyber.

396
00:30:46,960 --> 00:30:51,600
Just real quickly, what are we talking about? What are those? What's covered when we're

397
00:30:51,600 --> 00:30:58,400
layman's terms of each of those policies? Sure. So for cyber, you hear ransomware a lot in the news.

398
00:30:58,400 --> 00:31:02,400
Ransomware attacks will be covered to the extortion piece. Whatever the cyber attacker is

399
00:31:02,400 --> 00:31:06,480
demanding, that could be covered, the actual ransom. And then if there's business interruption

400
00:31:06,480 --> 00:31:11,840
that's caused by this, the business corruption can be covered. If there's data that's exfiltrated,

401
00:31:11,840 --> 00:31:17,360
the whole process of figuring out what data was exfiltrated, do I need to notify? Who do I need

402
00:31:17,360 --> 00:31:22,960
to notify? How do I get the data back so that a recovery often times finds and penalties. So

403
00:31:22,960 --> 00:31:27,760
there's a lot of different regulations around privacy in the states and outside the states.

404
00:31:27,760 --> 00:31:32,720
You can actually have coverage for that within a cyber policy. There's any sort of third party

405
00:31:32,720 --> 00:31:37,920
litigation coming in from network security or privacy issues that can be covered as well.

406
00:31:37,920 --> 00:31:42,160
And then media as well. So there's a lot and there's even more coverage just than that. Cyber's

407
00:31:42,160 --> 00:31:47,440
a weird one where there's no standard policy form and depends on where the market cycle is,

408
00:31:47,440 --> 00:31:53,280
but there can be a ton of different add-ons to a cyber policy. And then on the DNO side,

409
00:31:53,280 --> 00:31:58,000
we talked about this a little bit before, but if you're a director and officer joining a company,

410
00:31:58,000 --> 00:32:03,280
you want to make sure you're protected because your personal assets could be in stake. So it's

411
00:32:03,280 --> 00:32:08,400
covering a number of things. So it'll cover the reimbursements of a company's indemnification

412
00:32:08,400 --> 00:32:13,040
obligations that it actually covers the indemnification for the company itself. And

413
00:32:13,040 --> 00:32:17,520
which so those two, there's like, because a little bit complicated, most nods like side A,

414
00:32:17,520 --> 00:32:22,080
B, and C, but two of them are more like balance sheet protection and the other ones really to

415
00:32:22,080 --> 00:32:26,880
protect the personal assets of the director and officer. Like if a company really screws up,

416
00:32:26,880 --> 00:32:32,160
just making sure that the directors and officers aren't personally liable for the screw ups.

417
00:32:32,160 --> 00:32:37,600
Correct. Because that's how I always thought of it. Yeah, you don't want to join a company and

418
00:32:37,600 --> 00:32:43,760
then something happens and your actual personal assets are at stake. So a lot of times you require

419
00:32:43,760 --> 00:32:48,240
as a director and officer that that company has an insurance policy in place. That makes sense.

420
00:32:48,240 --> 00:32:52,720
And then they are mission-sized more, it depends on if it's technology errors and missions,

421
00:32:52,720 --> 00:32:57,280
or some sort of professional like, like lawyers will have a lawyers professional liability policy.

422
00:32:57,280 --> 00:33:02,000
And that's really to make sure there's any sort of error mission that you did, that it can be

423
00:33:02,000 --> 00:33:06,720
ended up being covered by a policy. So for tech, you know, technology errors and emissions, like

424
00:33:06,720 --> 00:33:13,760
coding error or a software bug or project delay and breach of any sort of breach of contract is

425
00:33:13,760 --> 00:33:18,800
really what's getting covered there. And for tech, you know, you can also sometimes see that paired

426
00:33:18,800 --> 00:33:25,040
with cyber insurance as well. So they sometimes go hand in hand. I don't think businesses sometimes

427
00:33:25,040 --> 00:33:32,000
realize how expensive lawyers are that even if they did something right, and I've seen this in so

428
00:33:32,000 --> 00:33:37,200
many contexts, and it's actually kind of sad sometimes, where even if they did something right,

429
00:33:37,200 --> 00:33:43,440
and somebody comes along and claims they did it wrong and sues them, once you're the defendant in

430
00:33:43,440 --> 00:33:49,760
a case, like in a posture like that, the expenses go like a hockey stick. And all of a sudden you're

431
00:33:49,760 --> 00:33:55,760
defending possibly completely bogus, horrible claims, and you're paying for an attorney and you're

432
00:33:55,760 --> 00:34:01,040
the feeling of injustice at that, that you're having to pay for an attorney when you could be

433
00:34:01,040 --> 00:34:06,000
100% in the right, doesn't matter. They found some lawyer to bring a completely BS case, right?

434
00:34:06,000 --> 00:34:11,280
I've seen it sadly a number of times. And if you don't have insurance to cover that, the odds that

435
00:34:11,280 --> 00:34:17,040
you might have, especially as a startup, a sufficient litigation defense fund built up,

436
00:34:17,040 --> 00:34:22,320
like people just don't think about how you could do everything right. And some litigious prick

437
00:34:22,320 --> 00:34:27,760
could like put your entire empire at risk. Do you know what I mean? It's horrifying. So yeah,

438
00:34:27,760 --> 00:34:32,880
a clean test, have litigation funding, which we could go to like a whole separate podcast.

439
00:34:32,880 --> 00:34:37,760
Oh gosh, yeah. That could be. And you're starting to see a nuclear verdict. They're seeing

440
00:34:37,760 --> 00:34:43,680
some of these claims being settled for crazy high amounts as well. Well, and that's the thing. I mean,

441
00:34:43,680 --> 00:34:48,400
you're talking, some of those might be legitimate. I'm talking about, I mean, I see it more kind of,

442
00:34:48,400 --> 00:34:51,840
like you see it unfortunately a lot in the sexual harassment space, employment litigation,

443
00:34:51,840 --> 00:34:57,200
just like shakedown lawyers that literally even before a lawsuits filed are out there making

444
00:34:57,200 --> 00:35:03,040
allegations, lawsuits filed, go on a podcast and basically defame people. I mean, you see horrible

445
00:35:03,040 --> 00:35:07,600
stuff to just shakedown people because your average person or your average small company

446
00:35:07,600 --> 00:35:12,160
does not prepare for the day that doing everything right, they still might have to defend because

447
00:35:12,160 --> 00:35:16,480
there's this perception that there's some kind of barrier to plaintiffs lit against, that some

448
00:35:16,480 --> 00:35:20,240
lawyer is going to say, well, no, you're not right. Like, you're actually wrong. You have no,

449
00:35:20,880 --> 00:35:24,240
you should not be allowed to bring this in court. Nope. There's some bottom feeder out there who

450
00:35:24,240 --> 00:35:29,040
will take that case and sue that poor individual or company and then they don't have insurance.

451
00:35:29,040 --> 00:35:35,200
And it's heartbreaking. It's heartbreaking. Yeah, we actually just had a client who just was dismissed

452
00:35:35,200 --> 00:35:40,080
from a lawsuit and a number of, it's a startup. They've been around maybe for two or three years.

453
00:35:40,080 --> 00:35:44,960
There's a number of similarly situated companies that are all named as defendants. All they did

454
00:35:44,960 --> 00:35:49,520
was invest in this one specific company and that's why they were sued. But they, I mean,

455
00:35:49,520 --> 00:35:53,760
they've all incurred a couple of million dollars in defense costs, even for having done nothing and

456
00:35:53,760 --> 00:35:57,440
the court came to the right decision and they were dismissed, but after incurring a couple

457
00:35:57,440 --> 00:36:03,520
million dollars in defense costs and that's just crazy. And if they didn't have insurance in place

458
00:36:03,520 --> 00:36:08,880
for a new company that really does, that kind of could put the end to that company. So, and I just,

459
00:36:08,880 --> 00:36:14,560
I would be remiss if we didn't also mention crime insurance and custody insurance. Custody

460
00:36:14,560 --> 00:36:19,680
insurance is also known as species insurance and both really ensure against the loss of assets

461
00:36:19,680 --> 00:36:24,720
from different events, but ultimately they ensure against the loss of assets. So, you'll see custodians

462
00:36:24,720 --> 00:36:30,720
or exchanges advertise that they have, you know, 50 million, 300 million, 800 million dollars of

463
00:36:30,720 --> 00:36:36,080
insurance and that tends to be that type of loss of asset coverage. So, if there's a hack, if there's,

464
00:36:36,080 --> 00:36:39,920
if you have, you know, a thumb drive stored somewhere and if someone steals it, that's where

465
00:36:39,920 --> 00:36:44,320
that insurance kicks in. I am so glad you explained that because I'm not going to lie. The first time

466
00:36:44,320 --> 00:36:49,200
you said species insurance to me, I thought it was like, oh, like if you discover a new one and

467
00:36:49,200 --> 00:36:55,440
somebody steals it and like claims it from you and then you don't get to name the new species. And

468
00:36:55,440 --> 00:37:01,680
I'm like, this actually makes so much more sense from an insurance perspective. So, these are the

469
00:37:01,680 --> 00:37:06,160
things where I'm like, I'm glad because I would have said, it can't be what I think species insurance

470
00:37:06,160 --> 00:37:10,800
is, right? So, that's awesome. And I appreciate when you guys explain terms that I think I know

471
00:37:10,800 --> 00:37:15,440
but I'm wildly off and wrong. So, if we start to use something and you're like, oh, have we defined

472
00:37:15,440 --> 00:37:20,160
that? We try to go back. So, I'm glad you caught that. Although we could probably create like a

473
00:37:20,160 --> 00:37:25,440
copyright intellectual property product for a new species if you want to, man, I can work with you.

474
00:37:25,440 --> 00:37:30,400
That has to be out there, I think. But I'm that idiot that like when I'm traveling and I see a

475
00:37:30,400 --> 00:37:34,640
bird or something, I'm like, has somebody seen that before? Could that be a new species? And I'm

476
00:37:34,640 --> 00:37:38,800
like, the odds that you're going to see a new species of anything. But these are just the stupid

477
00:37:38,800 --> 00:37:42,960
things that I think about that. But somebody might have created actual species insurance. You're

478
00:37:42,960 --> 00:37:47,200
right. I'm like, and if it doesn't exist, maybe it does or should. But yeah, these are the nerdy

479
00:37:47,200 --> 00:37:51,120
thoughts that I have. So, Cara and I can geek out on like, what are the insurances that don't exist

480
00:37:51,120 --> 00:37:55,040
that should exist? And I see how insurance can be wildly creative now that we're going down that

481
00:37:55,040 --> 00:37:59,200
hilarious rabbit hole. But a couple minutes ago, Cara, you were talking about like some of the

482
00:37:59,200 --> 00:38:04,000
advantages working with digital asset companies in terms of their tech savviness. But Sarah,

483
00:38:04,000 --> 00:38:10,000
I'm curious, like being in the weeds, are there challenges you face? Like, are there difficulties

484
00:38:10,000 --> 00:38:15,440
with digital asset companies? Or are they all just magical, wonderful, like super tech people?

485
00:38:15,440 --> 00:38:19,200
I mean, I'd love to think they're all just magical and magical. Magical unicorns.

486
00:38:19,920 --> 00:38:23,920
Totally. In my experience, that's what they are. But yeah, no, I mean, they're, well, we already

487
00:38:23,920 --> 00:38:27,920
touched on one of the challenges, like the lack of education. So companies in the space really

488
00:38:27,920 --> 00:38:33,360
not understanding why insurance is so valuable. So that's a lack of knowledge is one challenge.

489
00:38:33,360 --> 00:38:38,400
But I would say across the board, the biggest challenge is actually our regulatory environment

490
00:38:38,400 --> 00:38:43,760
here in the States. Just the uncertainty is terrifying to the insurance markets. Like,

491
00:38:43,760 --> 00:38:48,960
insurance markets, for the most part, tend to be very traditional companies and everything they do

492
00:38:48,960 --> 00:38:55,520
is based off of data. And the SEC being so aggressive and coming out of nowhere with some of their

493
00:38:55,520 --> 00:39:00,560
positions, it is alarming to the insurance markets who kind of are, you know, potentially stuck on

494
00:39:00,560 --> 00:39:06,240
the other side picking up the cost of defending an SEC enforcement proceeding. And so I think the

495
00:39:06,240 --> 00:39:10,720
lack of regulatory certainty right now is the biggest challenge for the industry, from the

496
00:39:10,720 --> 00:39:16,560
insurance perspective. So not to go like full geek, but I saw along came Polly, right? And I don't

497
00:39:16,560 --> 00:39:20,960
know if you ever saw that movie. Karen knows exactly. I feel like every insurance person I know

498
00:39:20,960 --> 00:39:25,600
has seen this movie because it's a rom-com about an actuary. And they actually managed to make

499
00:39:25,600 --> 00:39:31,360
like actuarial jobs like sexy and funny, only I think, what is it, Ben Stiller, I think can do that.

500
00:39:31,360 --> 00:39:37,120
But there is something he talks about where it's like, in order to underwrite, like in order to

501
00:39:37,120 --> 00:39:43,680
ensure against the worst case scenario, you actually have to do so much research and analysis on

502
00:39:43,680 --> 00:39:49,360
lots of data points to know over time, right, that this loss, this loss, this loss, it's going

503
00:39:49,360 --> 00:39:54,000
to be about these amounts or this activity, this activity, this activity is going to incur this

504
00:39:54,000 --> 00:39:59,120
much risk of enforcement. And to your point, like when that's hard to predict, that's like an

505
00:39:59,120 --> 00:40:05,440
actuary's worst nightmare because that means that math may not add up and we may ensure you and then

506
00:40:05,440 --> 00:40:09,360
all of a sudden there's some giant claim for activity that otherwise we would have thought

507
00:40:09,360 --> 00:40:14,080
was okay under this regulatory framework. But holy crap, like who brings an enforcement action on

508
00:40:14,080 --> 00:40:18,080
this, right? And so I think in my mind, and I don't know if this is right. So correct me,

509
00:40:18,080 --> 00:40:24,320
that's the underwriting process, right? Is doing analyzing that risk and then trying to figure

510
00:40:24,320 --> 00:40:29,600
out and maybe like, Kara, is that how underwriting works? Like what do you look at when you're

511
00:40:29,600 --> 00:40:33,520
underwriting, especially like for like crypto specific companies? Sure. So the underwriters

512
00:40:33,520 --> 00:40:37,760
typically work with the actuaries and the actuaries you're looking at to your point of

513
00:40:37,760 --> 00:40:42,560
asset of data points, there's not as many within the crypto space just to see what it hasn't been

514
00:40:42,560 --> 00:40:47,440
around long enough, but it's easy enough to compare different crypto companies with what the

515
00:40:47,440 --> 00:40:51,840
traditional company would be. So if it's a tech crypto company, then you can just compare it with

516
00:40:51,840 --> 00:40:57,840
a normal tech company and we'll get the law of history there. But to Sarah's point around

517
00:40:57,840 --> 00:41:03,200
regulation, sometimes when things like that happen, you might have to do like an asset analysis as

518
00:41:03,200 --> 00:41:09,760
if this regulation was at place before, as if it wasn't, and COVID just totally, I mean, a lot of

519
00:41:09,760 --> 00:41:14,960
people weren't aware how much the courts were backlogged with these cases. So just seeing

520
00:41:14,960 --> 00:41:20,000
like there weren't a ton of claims coming up in reality, there were, but they were just backlogged

521
00:41:20,000 --> 00:41:24,240
because of COVID. So there's a lot of different things you need to think about. And that's my

522
00:41:24,240 --> 00:41:28,560
really like insurance is you like to keep up with what's going on in the world regardless of what

523
00:41:28,560 --> 00:41:33,520
insurance pipeline there is. And if you think about, there's also like catastrophe models. So

524
00:41:33,520 --> 00:41:39,200
there's actual reason you can also have a cat model or role, which is not like a cat, like a

525
00:41:39,200 --> 00:41:44,480
kitty cat walking down like the wrong thing. You knew where I was going to ask. I love that you

526
00:41:44,480 --> 00:41:49,520
knew I was going to say that. I knew where you're going to sound like. I think I can't walk that,

527
00:41:49,520 --> 00:41:54,880
but it's a somebody that looks at what's the worst case scenario, right? And for properties, a lot

528
00:41:54,880 --> 00:41:59,760
easier because you can look at how many hurricanes have happened, but through cyber where there are

529
00:41:59,760 --> 00:42:04,880
cyber catastrophe models, but it's a lot more difficult because there hasn't been really like

530
00:42:04,880 --> 00:42:10,480
a massive cyber hurricane on that has caused a big loss at least to the intern industry. So it's

531
00:42:10,480 --> 00:42:16,960
very hard from an actuarial standpoint to price this and saying theater, comparing it with any

532
00:42:16,960 --> 00:42:20,960
other product line with a crypto is definitely I think the pricing becomes a challenge because

533
00:42:20,960 --> 00:42:25,600
there just hasn't been a lot of history. But from an underrated perspective, we'd be looking at

534
00:42:25,600 --> 00:42:30,240
what's the nature of the business or they confine with various regulations that are out there,

535
00:42:30,240 --> 00:42:36,560
early financially sound, what's the experience of the management, what's their past claims history,

536
00:42:36,560 --> 00:42:45,280
how seriously are they taking KYC and AML, what client for crypto is it, custody is an exchange,

537
00:42:45,280 --> 00:42:51,600
is it decentralized, can you transfer virtual assets, who are their clients being served?

538
00:42:51,600 --> 00:42:56,560
On the cyber standpoint, what exactly are they doing, how many records are they holding,

539
00:42:56,560 --> 00:43:02,320
what kinds of records are they? Healthcare information, is it just regular credit card

540
00:43:02,320 --> 00:43:09,040
information? And what are they working with the customer? So there's a lot there to unpack when

541
00:43:09,040 --> 00:43:13,680
you're analyzing the different policies. It feels like everything you just said is triggering a memory

542
00:43:13,680 --> 00:43:21,120
of something my mom said, is that creating a risk profile? All those questions? Essentially,

543
00:43:21,120 --> 00:43:25,760
yes, it will work with Sarah and we'll get the application that the insurer built out with

544
00:43:25,760 --> 00:43:30,000
Blue Star as assistants and we'll be able to analyze and then ask further questions. But

545
00:43:30,000 --> 00:43:35,600
we end up coming up with an underwriting rationale as to why do we think this is a good risk and why

546
00:43:35,600 --> 00:43:40,880
do we think the premium charge makes sense? And it is essentially to your point,

547
00:43:40,880 --> 00:43:46,720
creating a risk profile. So I get along with Paulie and be like, Ben Stiller comparing,

548
00:43:46,720 --> 00:43:53,360
I guess, was it his ex-wife or a sconce with Jennifer Aniston? Oh, I was thinking it was the

549
00:43:53,360 --> 00:43:59,120
moment when he refuses to touch bar nuts, like his feeling about where he's like, you have no idea

550
00:43:59,120 --> 00:44:04,080
how many hands do you have any idea the risk profile of bar nuts? And I don't think that was

551
00:44:04,080 --> 00:44:09,440
exactly the line, but I've never been able to touch bar nuts ever since that movie and it is

552
00:44:09,440 --> 00:44:15,040
wild. But I guess as I was sitting here thinking, obviously, my background was more in the law

553
00:44:15,040 --> 00:44:20,320
enforcement and AMLC of T-Space. And so when we think of the risk profile from a financial

554
00:44:20,320 --> 00:44:25,440
institution perspective, there are things that you can do. There's actually an entire industry

555
00:44:25,440 --> 00:44:31,680
around improving or getting your risk profile right, like balancing how much risk you're taking in

556
00:44:31,680 --> 00:44:36,000
and the AMLC of T program that you're putting in place in terms of how much compliance you need

557
00:44:36,000 --> 00:44:41,680
for that risk. And I'm curious, does that translate in terms of are there things that insurers can do

558
00:44:41,680 --> 00:44:46,160
to improve their risk profile or things that they it's like, where, okay, you're taking in this much

559
00:44:46,160 --> 00:44:50,880
risk, you can have X amount of insurance, but you need to kind of balance those things out.

560
00:44:50,880 --> 00:44:56,480
Does it work the same way? Yes, definitely. We make sure we're underwriting to that.

561
00:44:56,480 --> 00:45:01,760
Roeby has there been any audits done? If you go back, my background is very much in cyber,

562
00:45:01,760 --> 00:45:07,200
going back for a while. So are they doing backups? Are they doing caching? Are they doing employee

563
00:45:07,200 --> 00:45:13,360
training? Are they doing MSA? Are they managing their vendors? Do they have network segmentation?

564
00:45:13,360 --> 00:45:17,440
Do they have a privacy policy in place? Do they have a disaster recovery policy in place? And if

565
00:45:17,440 --> 00:45:22,080
they don't have those things, it's okay. We can work with them to help them get them. So whether

566
00:45:22,080 --> 00:45:26,880
Proof is working with vendors or Sarah can work with us to make sure that we're making them a

567
00:45:26,880 --> 00:45:32,320
better cyber risk hygiene profile that makes the insurance here is more comfortable and willing to

568
00:45:32,320 --> 00:45:36,880
work with that company. And it's the same thing looking at pretty much any insurance product line.

569
00:45:36,880 --> 00:45:40,720
There's definitely some things we can do to help them ensure become a better risk.

570
00:45:40,720 --> 00:45:45,680
And Sarah, I'm assuming maybe it does the broker play a role in that at all? Or

571
00:45:45,680 --> 00:45:51,840
like, are you in that process? Yeah, 100%. I would like to think that we kind of take care of it

572
00:45:51,840 --> 00:45:58,160
before we get to the proof or another market stage. Like we do work with a number of third parties,

573
00:45:58,160 --> 00:46:02,560
especially when it comes to cyber. And we can run a bunch of our own analytic tools and stuff

574
00:46:02,560 --> 00:46:07,600
to check a cyber hygiene for our clients. But even outside of cyber, a lot of times we talk about

575
00:46:07,600 --> 00:46:11,440
pen testing and whether our clients have had that done, depending on what type of company they are.

576
00:46:11,440 --> 00:46:15,360
From a D&O perspective, again, depending on the type of company, like how do they store their

577
00:46:15,360 --> 00:46:20,960
customer assets versus their own company assets? Do they have reserves in place? Like there's a lot

578
00:46:20,960 --> 00:46:25,600
that goes into preparing a client and making sure they're ready to go to the market. And we

579
00:46:25,600 --> 00:46:30,080
definitely help. Is it like cleaning up a house? Like cleaning up a house and staging it a little

580
00:46:30,080 --> 00:46:34,640
bit before you bring the realtor in to get your kind of like market, you know, assessment where

581
00:46:34,640 --> 00:46:38,800
it's like, don't leave crap all over the floor because filthy houses get lower prices kind of

582
00:46:38,800 --> 00:46:42,880
thing. Well, right. And you only get like to make one first impression. So as your broker,

583
00:46:42,880 --> 00:46:47,520
we want it to be the best impression possible. That it's funny. I was thinking that as you

584
00:46:47,520 --> 00:46:51,520
were saying it, I was like, I remember when I didn't clean before a realtor came over and she

585
00:46:51,520 --> 00:46:55,760
was like, oh, so you're going to be that client. And I was like, I'm so sorry. I just didn't think

586
00:46:55,760 --> 00:47:00,640
about it. But you're right. You really do only get one chance to make a first impression. And I,

587
00:47:00,640 --> 00:47:05,920
people say that, but I think it like plays out for absolutely everything. And I think one of you

588
00:47:05,920 --> 00:47:10,000
touched on this earlier, Sarah, I think it was you when you were talking about the SEC enforcement

589
00:47:10,000 --> 00:47:16,320
actions. But I'm curious, like, does interest from like digital asset companies in buying

590
00:47:16,320 --> 00:47:21,120
insurance, does it do market events like have impacts on that? Does it vary or like,

591
00:47:21,920 --> 00:47:26,080
how do they even take into account market events? Yeah. So it's funny because like, I feel like

592
00:47:26,080 --> 00:47:30,640
there should be a straightforward answer to that question. And I'm not sure there is like after

593
00:47:30,640 --> 00:47:36,720
the bankruptcies and FTX happened towards the end of 2022, like we were really concerned that

594
00:47:36,720 --> 00:47:40,160
carriers were going to pull out of the market, that we were going to see maybe less companies

595
00:47:40,160 --> 00:47:44,560
wanting to spend money. But it was the exact opposite. We saw a huge influx of companies wanting

596
00:47:44,560 --> 00:47:49,920
to buy insurance. So I think, or even, you know, using the upcoming having as an example, like we

597
00:47:49,920 --> 00:47:54,800
expect to see more miners looking for insurance because the having will have an effect on their

598
00:47:54,800 --> 00:48:00,960
balance sheet. And so I think as market events happen, I hope we continue to educate the digital

599
00:48:00,960 --> 00:48:05,120
asset ecosystem about the value of insurance. And then, you know, as potentially negative

600
00:48:05,120 --> 00:48:09,680
events happen, hopefully we see more and more companies coming to us to buy insurance because

601
00:48:09,680 --> 00:48:14,320
they understand there's a little bit more urgency when an event might have a negative outcome on

602
00:48:14,320 --> 00:48:19,280
pieces of the parts of the industry. But, you know, overall, like from the broker perspective,

603
00:48:19,280 --> 00:48:25,360
since probably 2018 or 2019, there's been like a steady influx of companies in the space looking

604
00:48:25,360 --> 00:48:30,720
for insurance, which is a really nice thing to see because we know the value of what it does. And I

605
00:48:30,720 --> 00:48:35,760
think companies are really starting to understand more about why it is important.

606
00:48:35,760 --> 00:48:39,760
Yeah, I will say, and I had this conversation recently in Australia because they have an

607
00:48:39,760 --> 00:48:44,400
amazing Australian DeFi Association there. And there's all kinds of just amazing startup

608
00:48:44,400 --> 00:48:49,280
founders who come. And we were talking about if we could just get a few more crypto lawyers and

609
00:48:49,280 --> 00:48:54,400
crypto insurance people in front of these folks early on, because I feel like that's the time

610
00:48:54,400 --> 00:48:59,600
where they're sitting in their mom's basement. And they really don't understand that during that,

611
00:48:59,600 --> 00:49:04,720
you know, family, family and friends fundraising, the best thing that they could do for themselves

612
00:49:04,720 --> 00:49:10,320
immediately is to actually just ensure and protect themselves. Like it should almost just be like a

613
00:49:10,320 --> 00:49:16,320
prerequisite. And maybe some folks Google and it says somewhere a startup, you know, the first thing

614
00:49:16,320 --> 00:49:21,920
you should do is get insurance. But when I think of how long it took us to get general liability

615
00:49:21,920 --> 00:49:25,600
insurance, just because we were moving so fast, we were doing events, we were doing all the things,

616
00:49:25,600 --> 00:49:29,440
things are going so well, I'm a freaking lawyer, I should know this. And then all of a sudden one day,

617
00:49:29,440 --> 00:49:33,920
four, six months goes by and you're like, holy guacamole, Batman, how have we not had this in

618
00:49:33,920 --> 00:49:38,640
place? And it's not that they don't know, it's just that there's you're so intent on building

619
00:49:38,640 --> 00:49:43,680
something. And especially when it's going well, that you're almost at more risk, because it's so

620
00:49:43,680 --> 00:49:47,920
easy to focus on the things going well that your mindset is not all the things that could go wrong.

621
00:49:47,920 --> 00:49:52,960
And so I think, you know, if I could get if there's a startup founder, if there's somebody out there

622
00:49:52,960 --> 00:49:58,320
listening to this, if I could if I could beg one thing, it's whatever money you have, that you

623
00:49:58,320 --> 00:50:03,040
think you don't have like call a broker, like if you're running a company and you don't have

624
00:50:03,040 --> 00:50:06,960
insurance, you might not even have the insurance that you need. But if you haven't talked to an

625
00:50:06,960 --> 00:50:11,760
insurance broker for the love of God, please call an insurance broker. Like that for me is the takeaway

626
00:50:11,760 --> 00:50:17,920
of the podcast. Call Sarah, call Sarah, trust me, she will tell you all the ways in which you have

627
00:50:17,920 --> 00:50:22,480
missed gaps in your life. And she made me feel so much better about it too. She was so nice. She's

628
00:50:22,480 --> 00:50:26,560
like, you're not an idiot, you're not a bad lawyer, like we can fix this, this is fixable.

629
00:50:26,560 --> 00:50:30,320
And it's such like an interesting cycle too, because the startups, first of all, when you're a

630
00:50:30,320 --> 00:50:34,720
startup, you could probably get insurance for a lot less money, because there's a lot less to insurer.

631
00:50:34,720 --> 00:50:39,760
But also like start building those insurance carrier partners then when everything is perfect

632
00:50:39,760 --> 00:50:44,960
and great, because fast forward five, 10 years when you're bound to have that claim, then you

633
00:50:44,960 --> 00:50:50,000
already have that deep partnership with a number of insurance carriers. So, you know, they're less

634
00:50:50,000 --> 00:50:54,080
likely to raise your insurance premiums and things like that, because they already know you and know

635
00:50:54,080 --> 00:50:57,760
how good you've been to work with. So, like the sooner you start to get to know the insurance

636
00:50:57,760 --> 00:51:02,720
carriers and put it within the better it is in the long run. Okay. So now that we have made it

637
00:51:02,720 --> 00:51:08,880
clear how sexy and exciting insurance is, the question that is on everybody's mind that is

638
00:51:08,880 --> 00:51:14,640
listening to this right now, I'm sure is, how do I get a career in the sexy insurance industry

639
00:51:14,640 --> 00:51:20,560
and what types of careers are there? So, I mean, we've covered obviously like broker, right? And

640
00:51:20,560 --> 00:51:25,200
Cara, what's your official like you're not an would you be an underwriter or you an insurer?

641
00:51:25,200 --> 00:51:29,360
Underwriter. Yep. Underwriter. Yes. So, usually the underwriters are working for the insurance

642
00:51:29,360 --> 00:51:35,440
companies or the insurers. We've talked a little bit about actuaries already, catastrophe models,

643
00:51:35,440 --> 00:51:40,080
so cat modelers, then a lot can I mean, actually, you're gonna more of a mathematical or

644
00:51:40,080 --> 00:51:46,960
actuary background. Usually, cat modelers will have actual or math background as well. And then

645
00:51:46,960 --> 00:51:52,240
there's a lot of legal backgrounds like on the claim side and contract wording. So, there's a

646
00:51:52,240 --> 00:51:57,200
lot of opportunities for a lot of people, product development, there's a lot. There's a ton of

647
00:51:57,200 --> 00:52:01,600
different roles within insurance. So, I think it could really, if someone's interested in it,

648
00:52:01,600 --> 00:52:07,040
there's a role for them in different areas. Well, I think, Sarah, I love that you touched on this,

649
00:52:07,040 --> 00:52:10,640
you know, because Cara is talking about things as if, you know, like, well, you need to have this

650
00:52:10,640 --> 00:52:15,120
background, but you didn't have a background insurance per se, you were a lawyer, and then

651
00:52:15,120 --> 00:52:20,960
you kind of moved over into like the insurance side. So, it's clear that people can get into it

652
00:52:20,960 --> 00:52:25,680
later if they're, I mean, obviously, the legal part was probably super relevant to it. But I'm

653
00:52:25,680 --> 00:52:30,080
curious, like, have you guys seen people make the switch having had like a previous career?

654
00:52:30,080 --> 00:52:35,120
Yeah, previous careers are just majors in history. It doesn't really matter what your major is, it

655
00:52:35,120 --> 00:52:41,200
can still apply from an insurance perspective. And it really is, it's been a great career. I mean,

656
00:52:41,200 --> 00:52:47,520
there's opportunities for travel, you're helping people with a very charitable industry. And

657
00:52:47,520 --> 00:52:52,480
it's very collegial too, there's a lot of networking going on and people, I mean,

658
00:52:52,480 --> 00:52:57,120
I married someone in insurance or our dinner conversations are not very exciting, but a lot

659
00:52:57,120 --> 00:53:01,920
of my friends are in insurance. And it is not true. I can tell you as a kid that sat at that table

660
00:53:01,920 --> 00:53:06,800
listening to insurance conversations, your children will be better off for it. Trust me. I was explaining

661
00:53:06,800 --> 00:53:10,560
long term care insurance to friends in college when they were like, what are you talking about

662
00:53:10,560 --> 00:53:15,600
right now? So trust me, you are setting them up for success to have the insurance discussions in

663
00:53:15,600 --> 00:53:19,840
front of your children as early as humanly possible. And I also love that you mentioned the travel

664
00:53:19,840 --> 00:53:24,640
opportunities without mic dropping where you're sitting and recording this from right now. You're

665
00:53:24,640 --> 00:53:30,240
in Bermuda, aren't you? I'm definitely in Bermuda and I can see the ocean right now. So it's some

666
00:53:30,240 --> 00:53:36,480
good views. So every aspect of insurance is sexy. Travel meeting a life partner, like you've covered

667
00:53:36,480 --> 00:53:43,200
all the insurance can get you everything you want in life, essentially. But I would be remiss as the

668
00:53:43,200 --> 00:53:47,920
Association for Women in Crypto if we didn't talk about kind of the elephant in the insurance room,

669
00:53:47,920 --> 00:53:51,760
if you will. You know, my mom used to talk about this all the time when she would go to risk management

670
00:53:51,760 --> 00:53:56,400
conferences that she was often like the only woman in a room of like two or 300 men. Now,

671
00:53:56,400 --> 00:54:01,840
this was obviously in like the 70s and fingers crossed different times. But is it or is it a

672
00:54:01,840 --> 00:54:06,720
still pretty male dominated industry? And hopefully times have changed. I'm crossing my fingers. You

673
00:54:06,720 --> 00:54:12,480
can't see it. Well, you can see it. But hopefully times have changed. I would say still male dominated,

674
00:54:12,480 --> 00:54:17,360
but it's getting way better. I mean, especially male dominated when you look at the managerial side,

675
00:54:17,360 --> 00:54:22,320
but I do like with the last I've been in the industry 20 years and the last 20 years it's gotten

676
00:54:22,320 --> 00:54:27,680
significantly better. And I was probably a unique one because I started in reinsurance and within

677
00:54:27,680 --> 00:54:33,040
directors and officers space, which was very, very heavily male dominated. But now that I look around

678
00:54:33,040 --> 00:54:38,080
the room, there's a lot more women, especially in exciting things like cyber or digital assets. I

679
00:54:38,080 --> 00:54:42,720
think women are the one of the first ones to raise their hand and say, Hey, like I all learn more on

680
00:54:42,720 --> 00:54:47,440
that. And I think this is going to be a big opportunity. And I think there's a lot more

681
00:54:47,440 --> 00:54:53,440
concentration at diversity in general within the interest industry. So it's gotten like a lot,

682
00:54:53,440 --> 00:54:58,000
a lot better. But there's still work to do for sure. But there's a lot of different industry

683
00:54:58,000 --> 00:55:03,120
groups out there. So I think in my intro, you had mentioned I'm on the board of AVIW, which has been

684
00:55:03,120 --> 00:55:07,680
around since the 70s. So that's the Association of Professional Insurance Women. And now I'm learning

685
00:55:07,680 --> 00:55:13,200
maybe your mom was in it at one point or maybe she's in it right now. I'm literally going to call her

686
00:55:13,200 --> 00:55:16,880
and ask her as soon as we hang up. I'm going to be like, tell me you've been in this thing. And I

687
00:55:16,880 --> 00:55:22,400
had no idea she's in like nearly every other women's association. So that would not surprise me. But

688
00:55:22,400 --> 00:55:26,240
it was literally when I saw it, I was like, I wonder if my mom was in this. But Sarah, have you had

689
00:55:26,240 --> 00:55:31,520
the same experience or hopefully it's gotten better? Yeah, no, I echo everything Kara said. Like it

690
00:55:31,520 --> 00:55:38,640
really has always traditionally been a male dominated industry. But there's still those moments

691
00:55:38,640 --> 00:55:42,560
where and I joke about it with some of my team members all the time, we did these two days of

692
00:55:42,560 --> 00:55:47,840
merkin meetings in New York, and we had coffees and lunches and breakfast and dinners and literally

693
00:55:47,840 --> 00:55:52,800
all cryptocurrency related insurance markets. I was the only woman at every single table we

694
00:55:52,800 --> 00:55:58,640
sat at. And but and it was so but it was actually good because it was so obvious because that is

695
00:55:58,640 --> 00:56:04,080
not normal anymore. Like normally it really is much more mixed. So we're moving in the right

696
00:56:04,080 --> 00:56:08,800
direction, which is really, really exciting because you think about insurance, like it's such an old,

697
00:56:08,800 --> 00:56:15,360
typically traditional, conservative, slow moving industry. And it's really changed so much. And

698
00:56:15,360 --> 00:56:19,440
it's so so I mean, I can't wait to see what the next few years have in store. I think it's just

699
00:56:19,440 --> 00:56:26,240
going to keep evolving and becoming more inclusive. And it'll be to be amazing and just great stuff.

700
00:56:26,240 --> 00:56:31,360
Well, I will say I've gotten to know both of you. Sarah, obviously I knew before, but Kara got to

701
00:56:31,360 --> 00:56:36,000
know you through prepping for this. And you're both such incredibly warm, wonderful women. And I

702
00:56:36,000 --> 00:56:40,720
hope, you know, if you're a woman out there interested in the insurance industry or questions,

703
00:56:40,720 --> 00:56:46,160
you know, I hope you'll follow Sarah and Kara on LinkedIn and reach out and connect with them.

704
00:56:46,160 --> 00:56:50,400
And I'm sure they'd be happy to talk with you about or reach out to me. And I'm happy to get you

705
00:56:50,400 --> 00:56:55,200
in connection with even more women in the insurance industry. But would love to echo what Sarah said.

706
00:56:55,200 --> 00:56:59,120
And especially what Kara said, which is that we see this all the time in crypto blockchain

707
00:56:59,120 --> 00:57:03,200
Web 3, which is actually part of why I created the association is that women are the first to

708
00:57:03,200 --> 00:57:07,840
raise their hands to learn new things, especially in USgov. If you look at who were the leading

709
00:57:07,840 --> 00:57:12,400
kind of like prosecutors, agents, analysts, initially everyone, for some reason, all women

710
00:57:12,400 --> 00:57:17,520
learning this new weird thing. And we just have to be a little bit better about taking that learning

711
00:57:17,520 --> 00:57:22,320
and using it to propel ourselves upward, not just into but upward. And so I'm always really

712
00:57:22,320 --> 00:57:26,560
excited when women like Kara and Sarah have done that process and come and kind of share their

713
00:57:26,560 --> 00:57:31,200
knowledge. Kara, Sarah, I love that your name is Rhyme, but I also love that we were able to have

714
00:57:31,200 --> 00:57:35,360
you guys. I told you when you said, I don't know how we're going to make insurance sexy. I was like,

715
00:57:35,360 --> 00:57:39,840
you don't have to make insurance sexy. I told you this would be a fantastically fun time.

716
00:57:39,840 --> 00:57:44,640
Having learned from somebody who managed to make insurance fascinating and interesting my entire

717
00:57:44,640 --> 00:57:49,280
life, I can't imagine anyone better to have this conversation with. So just want to say thank you

718
00:57:49,280 --> 00:57:53,680
for being here for your wonderful explanations, your patience with me and not knowing what

719
00:57:53,680 --> 00:57:58,080
species your catwalks really were. So this was great. I also want to say a huge thank you to

720
00:57:58,080 --> 00:58:04,000
our sponsor Bracewell LLP to Emily Krabowski for her invaluable technical support, Stephen Sargent

721
00:58:04,000 --> 00:58:08,400
and Airdrop for their assistance with post production and everybody who tunes in and listens.

722
00:58:08,400 --> 00:58:12,560
Positive or negative, we welcome your feedback and we hope you'll rate us online. Please let us

723
00:58:12,560 --> 00:58:16,960
know if you have comments, questions or thoughts for future podcasts. For anyone who's interested

724
00:58:16,960 --> 00:58:21,280
in learning more about the association, our global events or the initiatives we're working on to

725
00:58:21,280 --> 00:58:26,080
increase inclusion, please check out our public LinkedIn page, our Twitter or Instagram pages

726
00:58:26,080 --> 00:58:33,680
at AWIC Global or our webpage at www.womenincrypto.org, which is also where you can sign up and join.

727
00:58:33,680 --> 00:58:38,960
Thanks again for tuning in. We hope you have a wonderful day, a great week and we hope to see you next time.