OneDegree projects a profitable 2024 thanks to one particular service
OneDegree projects a profitable 2024 thanks to one particular service | Insurance Business Asia
Insurance News
OneDegree projects a profitable 2024 thanks to one particular service
Insurance service is expected to surge by next year
Insurance News
By
Jonalyn Cueto
Hong Kong virtual insurer OneDegree is on track to become profitable by 2024 thanks to its popular insurance policies for household pets and digital assets, according to the fintech firm’s top chief.
Alvin Kwock Yin-lun, co-founder and chief executive of OneDegree, said in an interview with South China Morning Post that this year the company is expecting to halve its underwriting losses, and then turn a profit by the second half of next year. The silver lining appears to have been found in the positive performance of OneDegree’s pet and digital-asset insurance operations called OneInfinity, which was introduced in November 2021. It offers insurance to digital-asset businesses such as cryptocurrency exchanges, custodians and wallet providers.
Kwock Yin-lun said the service has “reached scale,” having signed up more than 30 clients since launching with no claims to date. OneInfinity now accounts for 10% of OneDegree’s revenue, according to Kwock Yin-lun. The insurer is now expecting the figure to grow to about 30% in the fourth quarter this year.
Booming digital assets trading
Global interest in Hong Kong’s crypto exchange licensing regime has been noted to be strong with nearly half of the world’s top-20 crypto exchanges contacting OneDegree about its OneInfinity insurance. Among the mandatory requirements of the government for crypto exchanges is to have insurance or compensation arrangements that would cover potential losses.
Kwock Yin-lun said OneDegree’s underwriting process includes the examination of the applicant’s custody architecture and cybersecurity setup, among other things. Thus far, the firm has accepted only about 25% of all insurance applications over the past two years.
The insurer has conducted five rounds of fundraising to date as it aims to expand its digital-asset insurance portfolio. It had raised over US$27 million by June this year from investors, including Gobi Partners, Sun Hung Kai and Bitrock.
The next step for OneDegree is extending its reach to the Middle East, while investing in the utilization of artificial intelligence (AI) applications, according to Kwock Yin-lun. One of the plans is to build an AI recommendation engine for consumers and a security operations center that provides guidance for users in case of cybersecurity breaches.
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