My broker told me my custodial wallet was “Insured by Lloyd’s of London.” I felt safe. Then I learned that “Lloyd’s” isn’t a company; it’s a marketplace. And the specific syndicate insuring my crypto only had a $10 million limit for the entire exchange’s user base.
Key Takeaways
- Lloyd’s is a Market: Think of Lloyd’s as a bazaar of insurers (Syndicates). When you get a policy, it is backed by specific syndicates (e.g., Arch, Canopius, Evertas).
- The “Specie” Market: Crypto is insured as “Specie” (like gold bars or fine art) in the vault, or as “Cyber” (data) on the network. Specie policies are cheaper but strictly for cold storage (offline).
- Capacity Limits: A syndicate might write a $50M policy. If the exchange holds $5 Billion, that insurance covers 1% of the assets.
- “Shared Limits”: The policy usually covers all customers. If there is a massive hack, the $50M payout is split among 1 million users. You get $50.
The “Why” (The Trap)
The trap is “Marketing vs. Math.”
Exchanges say “Insured by Lloyd’s” to sound secure. They rarely disclose the Limit of Liability.
If an exchange has $1B AUM and a $100M policy, they are 90% underinsured.
The Investigation (The Players)
I identified the key syndicates writing crypto in 2026.
Evertas (Coverholder at Lloyd’s)
- Role: The only dedicated crypto insurer. They understand the tech.
- Focus: They write the strictest policies. If an exchange uses Evertas, they have passed a serious audit.
Arch Insurance (Syndicate 2012)
- Role: A heavy hitter in the “Specie” market (Cold Storage).
Munich Re / Relm
- Role: Competitors to Lloyd’s who also write large crypto policies.
Comparison Table
| Policy Type | Coverage Trigger | Typical Limit | Cost |
| Specie (Cold Storage) | Physical Theft / Staff Theft | High ($500M+) | Low |
| Cyber / Crime (Hot Wallet) | Hack / Exploit | Low ($50M) | High |
| Technology E&O | Glitches / Downtime | Medium | Medium |
Step-by-Step Action Plan
- Demand the “Slip”: If you are a high-net-worth client, ask the custodian for the “Evidence of Insurance” or the “Slip.” Look for the “Limit of Liability.”
- Calculate the Ratio: Divide the Insurance Limit by the Exchange’s Assets Under Management (AUM). If the number is less than 50%, be wary.
- [IMAGE: Infographic showing a tiny insurance umbrella covering a massive pile of crypto assets]
- Ask “Is this Dedicated?”: Ask if the limit is shared among all clients or dedicated to you. (Dedicated requires a private vault).
FAQ
Can I buy a Lloyd’s policy for myself?
Yes, if you hold >$1M assets. Contact a specialist broker (like Lockton or Marsh).
Does Lloyd’s cover DeFi?
Rarely. They prefer centralized, audited custodians.