30 · SMART CONTRACT INSURANCE

Version: 1.0 | Date: 12.03.2026 | Status: Canonical Category: Product / Risk SSOT for: Smart contract coverage strategy, DeFi insurance architecture Dependencies: 06_YIELD_PROTOCOL (WellexVault), 15_RISKS, 22_PLATFORM_PROTECTION

TL;DR

Smart contract insurance — mandatory element of trust stack for DeFi platform
Two-tier protection: platform-level coverage + optional user-level coverage
Providers: Nexus Mutual, InsurAce, UnoRe — decentralized; Evertas, Coincover — custodial bridge
Paid from Insurance Fund (8–12% TVL) — no additional user fees

1. Why It's Needed

DeFi ecosystem — high-risk environment. From 2020 to 2025, smart contract exploits drained $6.8B+ from various protocols. Wellex manages user deposits in USDC/USDT — without smart contract insurance this is unacceptable risk for any serious investor or partner.

Key requirement from institutional players:

"Do you have smart contract insurance?"

Without a positive answer, B2B integration talks, partnerships with corporations and fitness networks stall at due diligence.

2. Protection Architecture

2.1 Insurance Levels

Level 1 — Platform Coverage (active by default for all)
  └─ Covers: WellexVault, yield strategies, LayerZero bridge
  └─ Provider: Nexus Mutual + InsurAce (dual cover)
  └─ Funding: Insurance Fund (8–12% TVL)

Level 2 — User Deposit Opt-In (additional, user choice)
  └─ Covers: individual user deposit
  └─ Provider: InsurAce (pay-per-deposit)
  └─ Cost: 0.5–1.2% of deposit amount/year (paid from yield)
  └─ Activation: WEB Dashboard → Settings → Insurance

2.2 What Is Covered

Risk	Coverage	Provider
Smart contract vulnerability (exploit)	✅	Nexus Mutual
Rug pull / admin key compromise	✅ (with limits)	InsurAce
Oracle manipulation (Chainlink PoR)	✅	Nexus Mutual
Stablecoin de-peg (USDC/USDT >10%)	✅ up to 80% of losses	InsurAce
Bridge exploit (LayerZero)	✅	UnoRe
Centralized exchange insolvency	❌	—
Market losses (yield < 0)	❌	—
User private key loss	❌	—

Important: insurance covers technical failures and smart contract exploits — not market risks or losses due to user actions.

3. Insurance Providers

3.1 Nexus Mutual — Platform Primary

Parameter	Value
Type	Decentralized mutual, on-chain claims voting
Coverage	Smart contract exploit, re-entrancy, logic bugs
TVL coverage	Up to $20M per contract
Premium	~2.6% of covered amount/year
Payout	On-chain in ETH/DAI, <72 hours after governance vote
Network	Ethereum mainnet + L2
Wellex status	Target: Phase 1 (obtain cover in M1)

Why Nexus Mutual: largest DeFi insurance protocol, $500M+ payouts, trusted by Aave, Compound, Maker. For users and partners — most recognizable insurance brand in DeFi.

3.2 InsurAce — User Opt-In + Stablecoin De-peg

Parameter	Value
Type	Decentralized, cross-chain
Coverage	Smart contract + custodian risk + stablecoin de-peg
Networks	Arbitrum, Polygon, Ethereum, BNB
Premium	0.5–1.2% of deposit/year
Minimum	$100 coverage
Payout	In USDC, 14 days after approved claim
Wellex status	Target: Phase 1, optional level for users

User flow:

User makes deposit on WEB platform
When "Insurance Cover" option is activated — InsurAce calculates premium (shown in interface)
Premium deducted from first yield credit
User receives on-chain insurance certificate (NFT)
In case of insured event — submits claim via wellex.ai or InsurAce dashboard

3.3 UnoRe — Bridge Protection

Parameter	Value
Type	Specialized bridge insurance
Coverage	LayerZero cross-chain bridge exploits
Networks	Multi-EVM (7 chains)
Premium	~1.5% of bridged volume/year
Wellex status	Target: Phase 1 (simultaneously with Multi-EVM launch)

3.4 Coincover — Custodial Safety Net (B2B)

Parameter	Value
Type	Centralized insurance (UK FCA regulated)
Coverage	Theft, unauthorized access, business continuity
Audience	Corporate clients (B2B), HNW deposits
Limit	Up to $1M per corporate account
Cost	Negotiated, ~0.5–1%/year
Wellex status	Target: Phase 2 (B2B launch)

4. Insurance Fund

Insurance Fund finances platform-level coverage. Mechanics:

Each transaction through WellexVault:
  → 2% of yield fee goes to Insurance Fund
  → Insurance Fund maintained at 8–12% of total TVL

At TVL $15M → Insurance Fund = $1.2M–$1.8M
At TVL $100M → Insurance Fund = $8M–$12M

Insurance Fund composition:

50% in USDC (immediate liquidity)
30% in Nexus Mutual cover (smart contract)
20% in InsurAce platform cover

Transparency: Insurance Fund balance displayed in real time at wellex.ai/transparency

5. Bug Bounty Programme

Parallel line of defense — vulnerability discovery before exploit.

Tier	Severity	Reward	Payout timeline
Critical	Remote code execution, loss of funds	$50,000 USDC	48 hours
High	Significant fund risk, privilege escalation	$15,000 USDC	72 hours
Medium	Limited fund risk, DoS	$5,000 USDC	7 days
Low	Minor bugs, UX issues	$500 USDC	14 days

Platform: Immunefi (largest DeFi bug bounty, $250K total pool) Scope: WellexVault, YieldRouter, WVI Oracle, Partner contracts Status: Target launch — M1 (simultaneously with public launch)

6. User Transparency

Public page wellex.ai/insurance

Contains:

List of active insurance providers + coverage amounts
Insurance Fund balance (on-chain)
Claims history (0 claims — best indicator)
Links to insurance certificates
Bug Bounty leaderboard (public hackers with permission)

┌─────────────────────────────────────┐
│  🛡️ Your deposit is protected       │
│                                     │
│  Platform Coverage   ✅ Active      │
│  Nexus Mutual · $15M pool           │
│                                     │
│  Your Deposit Cover  ○ Optional     │
│  InsurAce · +0.8%/yr from yield     │
│  [Activate]                         │
│                                     │
│  Insurance Fund      $1.47M         │
│  wellex.ai/insurance                │
└─────────────────────────────────────┘

7. Communication — How to Talk About Insurance

In public materials

"WellexVault is protected by dual smart contract coverage through Nexus Mutual and InsurAce. Additional individual deposit coverage available on request. Insurance Fund maintained at 8–12% TVL. Details: wellex.ai/insurance"

In partner conversations

"Beyond DeFi yield, Wellex is the only wellness protocol with professional smart contract insurance coverage. Nexus Mutual, InsurAce, Bug Bounty on Immunefi — three layers of protection."

In B2B negotiations

"For corporate clients, additional coverage through Coincover (FCA regulated) is available — up to $1M per corporate account. This is a level rarely seen even at major DeFi protocols."

8. Implementation Roadmap

Stage	Timeline	Task
M1 (March 2026)	Launch	Nexus Mutual cover activated, Immunefi bug bounty launched
M1 (March 2026)	Launch	InsurAce user opt-in available in WEB Dashboard
M1 (March 2026)	Launch	wellex.ai/insurance page public
M2 (April 2026)	Growth	UnoRe bridge protection activated
M6 (Aug 2026)	B2B	Coincover for corporate clients
M12 (March 2027)	Scale	Insurance Fund reaches $3M+ (TVL $25M+)

Changelog

▸ v1.0 (12.03.2026) — created Opus 4.6. Two-tier architecture, 4 providers, Insurance Fund, Bug Bounty, UX Widget.

→ Related: 06_YIELD_PROTOCOL.md · 15_RISKS.md · 22_PLATFORM_PROTECTION.md

⚠️ DeFi yield and insurance payouts are targets — not guarantees. Actual results depend on market conditions, TVL, and DeFi protocol performance.

TL;DR​

1. Why It's Needed​

2. Protection Architecture​

2.1 Insurance Levels​

2.2 What Is Covered​

3. Insurance Providers​

3.1 Nexus Mutual — Platform Primary​

3.2 InsurAce — User Opt-In + Stablecoin De-peg​

3.3 UnoRe — Bridge Protection​

3.4 Coincover — Custodial Safety Net (B2B)​

4. Insurance Fund​

5. Bug Bounty Programme​

6. User Transparency​

Public page wellex.ai/insurance​

WEB Dashboard — Insurance Widget​

7. Communication — How to Talk About Insurance​

In public materials​

In partner conversations​

In B2B negotiations​

8. Implementation Roadmap​

Changelog​