Although insurance providers are incentivized to vote coherently on valid insurance claims, as incohesive LP’s would drive insurees away from the system, I believe these incentives are not sufficient enough for LP’s to behave coherently.
Choose and implement a third party voting system such as Kleros Court for voting on insurance claims.
Kleros has already implemented a working decentralized court system, which has already showcased it’s effectiveness in prediction markets such as Omen.
In the current implementation, insurers would be incentivized to vote against any claims that are large enough to wipe out insurers’ funds, even if it would drive away insurees in the long run.
A third party system would have no, or minimal economic incentives to vote incoherently in their own financial interests.
By not relying on insurance providers or YFI governance voters for claims settlement, insurees confidence in the yinsurance system would be improved. This would most likely attract more users and be a net benefit for all parties.
For: Implement a third party voting system for insurance claims.
Against: No changes from currently known yinsure specification.
- Implement a third party voting system.
- No changes from original specification.
Citations / Further reading:
Kleros yellowpaper: https://kleros.io/static/yellowpaper_en-28d8e155664f3f21578958a482f33bd1.pdf
Writeup on Case 302: https://medium.com/the-definancier/kleros-the-epistemic-engine-beyond-case-302-267b72bf5506