# Collateralised Reinsurance Structure

### Traditional vs OnRe Collateralised Reinsurance Structures

Traditional collateralised reinsurance relies on capital locked in offchain trust structures, with limited transparency, slow settlement, and little to no secondary liquidity. OnRe’s collateralised reinsurance brings the structure onchain, enabling real-time transparency, active collateral management, and secondary market liquidity while maintaining full collateralisation.

| Feature                    | Traditional Structure                                                                            | OnRe Digital Asset Structure                                                                            |
| -------------------------- | ------------------------------------------------------------------------------------------------ | ------------------------------------------------------------------------------------------------------- |
| Licensing                  | Licensed (re)insurer in Bermuda or other jurisdiction                                            | Licensed (re)insurer in Bermuda, regulated under both insurance and digital asset regimes               |
| Capitalization             | Capital received from investors or reinsurers                                                    | Capital received from KYC’d, accredited investors, governed by Participation Agreements                 |
| Collateral Holding         | Funds placed in a third-party trust account at a commercial bank                                 | Funds held in segregated digital custody, e.g. Coinbase Prime, Safe, or Squads Multi-Sig Wallet         |
| Custody Control            | Trustee follows pre-agreed release instructions from cedant                                      | Funds can only be released via multi-signature authorisation under OnRe control                         |
| Cedant Control             | Cedant may instruct trustee directly on claim event                                              | Cedant can be added as read-only viewer or co-signer in multi-sig for greater transparency/control      |
| Verification of Collateral | Requires trust bank reporting or statement                                                       | Anyone can independently verify funds at any time via Blockchain Explorer                               |
| Trigger for Release        | Release occurs on (i) claim notification by cedant to trustee, or (ii) expiry of trust agreement | Release occurs on (i) verified claim, or (ii) run-off of (re)insurance liabilities                      |
| Wording                    | Standard reinsurance contracts with references to trust                                          | Standard reinsurance contracts, denominated in USD, with reference to digital asset collateral          |
| Segregation of Funds       | Trust agreement and bank account administered for benefit of cedant                              | Statutory segregation under Bermuda SAC Act law; each account ring-fenced and independently capitalised |
| Cost                       | Trust fees, legal set-up, bank charges, ongoing administration                                   | No trust needed; reduced complexity and cost via programmable custody controls                          |
| Operational Resilience     | Dependent on third-party trustee responsiveness and banking hours                                | Onchain infrastructure operates 24/7; all transactions require multi-party cryptographic approval       |