Similar to classic parametric cover arrangements, Neptune Mutual uses cover pools that promise payouts when predefined event(s) are triggered.

People who buy cover pay a fee to join as policyholders. These policyholders receive a special token referred to as cxTokens, or claim tokens. In theory, the cxTokens may take forms such as cxDAI, cxUSDC, cxBUSD, etc., representing a stablecoin. If a cover incident happens and is resolved, users can redeem the cxDAI to obtain a payout of the same value in DAI, after deducting protocol fees.

Neptune is built around the parametric insurance coverage model. It protects policyholders from losses tied to specific events, sometimes called cover parameters. Policyholders pay a premium for coverage over a fixed period and for a chosen coverage amount. When an incident takes place-provided the parameters are met and the resolution confirms that the event occurred-cover purchasers receive entitlement to payout without individual review. This structure supports quicker payouts by removing the need for claim back-and-forth between underwriters, claims assessors, loss adjusters, or other intermediaries and centralized parties, helping platforms/cover creators protect their reputation and keep users during an incident.

Token Utility