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Claims Assessment

Where can I see past claims decisions?

Below are places you can review past decisions: 1) Claims History: this section provides context on past claim outcomes for major loss events. 2) Nexus Tracker: this dashboard displays all past claims and includes a visual of Claims Assessment vote outcomes below.

How do you determine the outcome of a claim?

Members will act as judges, with each claim subject to a yes/no vote by members who have chosen to stake a portion of their NXM to act as Claims Assessors.
The Claims Assessors earn rewards for voting with the consensus outcome. If anyone is deemed to have voted fraudulently, their stake may be burned via the Governance process.
For more detailed information, see the Claims Assessment docs page.

When is loss of funds (in DAI or ETH) determined for a claim?

When a cover holder experiences a material loss, they can file a claim. During the Claims Assessment process, members acting as Claims Assessors will discuss a claim and vote on whether or not the claim meets the criteria outlined in the relevant cover wording.
When Claims Assessors discuss the value of the lost funds, they refer to the value of the funds just before the exploit took place.
If a claims payout is approved through the Claims Assessment process, the cover holder will receive a payout.
For more detailed information, see the Claims Assessment section.

Why would claims be paid? Isn’t there an incentive for the Claims Assessors (as Members who own the pool) to decline claims?

If Claims Assessors were to begin denying legitimate claims, thus failing to fulfil the core purpose of the mutual, then no new users would come to the platform and make contributions to it.
While it is true that successful claims would lower the value of the capital pool and hence the value of the NXM tokens the Claims Assessors hold and earn in the short-term, Claims Assessors are also financially incentivised to take a longer-term view as they are required to lockup a stake. This stake can be burned if there is deemed to be clear fraudulent voting activity by Claims Assessors (see Advisory Board section for details).
Denying legitimate claims would result in Claims Assessors having their NXM stake burned and, in the long term, the NXM earned through Claims Assessment would lose its value. The economic incentive aligns interests between members to promote positive contributions and to deter fraudulent behaviour in the Claims Assessment process.
We acknowledge this is a complicated and important aspect to what Nexus Mutual offers. That is why we have tested the design with our partners, Incentivai, who use machine learning algorithms in order to model the behaviour of economically incentivised AI agents.
Using Incentivai's AI and machine learning tools we have identified a combination of parameters which give us confidence that close to 100% of genuine claims will be paid and close to 0% of non-genuine claims will be paid.

Have any Claims Assessors had their NXM stake burned for fraudulent voting during the Claims Assessment process?

Yes, there has been an example of a Claims Assessor voting fraudulently. A member submitted a claim for a Kraken Custody Cover policy where no loss had occurred. This was Cover ID 3102, Claim ID 94.
The member who submitted the claim then staked 131.5 NXM to act as a Claims Assessor. This member then voted on their own claim with a Yes vote. Because there was no loss on Kraken and the member decided to vote on their own claim where no loss had occurred, our members voiced their opinion and directed the Advisory Board to burn the Claims Assessor's staked NXM.
Proposal #148 was passed with 4 out of 5 Advisory Board votes to burn the 131.5 staked NXM. The following transaction shows the staked NXM being burnt: 0xe2cc5d1d18885c533b167abdcb3115a1bd2204e0e469a31c548350d38f9500f6