Mitsui Sumitomo Insurance, HARTi launch insurance for NFT transactions

Tokyo-headquartered Mitsui Sumitomo Insurance and NFT-related company HARTi have developed Japan’s first insurance policy specifically for NFT art, according to Japanese newspaper Nikkei. 

HARTi director Yuya Yoshida made the announcement on Twitter, Nikkei reported on July 26.

The new policy would pay exhibitors in the event of theft of works due to unauthorised access or other reasons. It will be attached to all works being transacted on an invite-only marketplace operated by HARTi in the future. The insurance premiums will be paid by HARTi.

This policy was the first step by HARTi which has plans to start providing insurance coverage for locations with low security risks at home and abroad, Nikkei reported, adding that HARTi has off-chain and on-chain systems to prevent NFT leaks caused by unauthorised access.

Yoshida said insurance was vital to the health development of Japan’s NFT market, making it worth developing the system from scratch. “The elements of security and safety are essential to encourage major Japanese companies, from department stores and commercial facilities to brands, to enter the NFT market.” 

“Existing major companies will continue to enter the market from now to 2023. We hope that this will help to guarantee the safety of the domestic NFT distribution market”.

Social media accounts for NFT projects being hacked and used to share scam links have caused considerable losses and remain a major concern to many.

In June, the popular NFT collection Bored Ape Yacht Club (BAYC)’s own Discord server was hacked, causing a loss of approximately 200 ETH (approximately US$285,000) in users connecting to scam links shared on the social media app. Leading NFT marketplace OpenSea also announced in May that a phishing scam had taken place on its Discord account.