reinsurance

In the wake of Re's TGE, Re CEO and co-founder Karn Saroya [1] joined Andy and Robbie on The Rollup [2] to talk numbers, the team's decision to launch the $RE governance token, and where the protocol goes from here.
The TGE in the Rearview
Re is likely the only DeFi protocol to ever present audited financials as part of a listing process. Those financials set the tone for exchanges like Binance, OKX, Coinbase, Robinhood, and Kraken to get comfortable listing a reinsurance governance token.
But the milestones he was most focused on lie in the future.
"I'm very, very happy to be refocusing on growth. TGE can be distracting for anyone who's ever put one together." — Karn Saroya, CEO of Re
At the time of recording, Re was at $510 million in business and had added roughly $149 million in new business over the prior 45 days alone. Re's total value locked has now reached $560 million [3].
A Business Built to Compound
The north star is not a token price or a buyback program. It is compounding the underlying business.
"As an operator, I'm singularly focused on making sure the business compounds, first and foremost." — Karn Saroya
The underlying economics are straightforward. Premiums come in, capital gets invested, an insurance margin is earned on every dollar of premium, and the economics flow to each part of the capital stack. What makes Re different is the first-loss structure: Re puts its own capital at risk before any depositors.
"We stood up and said we're going to be in a market that's opaque, that people don't understand. If you're a depositor in this protocol, you are protected. If we win, you win. If we lose, you may still win." — Karn Saroya
Re remains on track to do 5x to 7x year over year [4], profitable, growing at a venture clip but not dependent upon venture capital to get there.
Why Launch a Token?
"We're building something larger than a reinsurer. The idea is a global capital ocean that can be accessed by any insurance company and reinsurer in the world, with economic alignment that is perfectly correlated with the capital provider." — Karn Saroya
A single reinsurer is a big idea. A global coordination layer for all insurance capital is a bigger one, and that requires a mechanism to govern it: a council that sets who can transact, what lines of business are acceptable, how much capital needs to be posted, and what happens to the economics of the network over time. That is what the $RE token is designed to enable.
Karn pointed to the scale of what is coming. There are $700 billion locked in security collateral among reinsurers today, a multiple of the entire stablecoin market. "Every single dollar that's in insurance will end up in digital asset form or onchain at some point," he said. "There needs to be a coordination layer for that."
The AI Underwriter Vision
"At some point, you're going to have hyper-intelligent computers that capture underwriting information, run the math, figure out the expected loss on an insurance policy, write the policy, provision the capital onchain, all in one fell swoop." — Karn Saroya
The insurance industry moves slowly, but the pieces are all there to make it faster. Agentic actuaries [5], for example, are AI underwriters that compress the entire insurance workflow from information capture to capital provisioning. "If the pieces are all there, and there are willing participants, and folks who are just going to push, we're going to get there," he affirmed.
What the Long-Term Looks Like
Re's current focus is on building a track record, scaling carefully, and making sure there are no blowups. Karn noted that large insurers and reinsurers almost inevitably end up evolving over time.
"They morph into asset managers in the limit. If you've got hundreds of billions of investable float, you're going to buy airports, sports teams, fixed income, equities. The capital finds its way to proliferate." — Karn Saroya
However, he labeled that a far-future consideration: "I'm just focused on making sure we compound the thing now." In the near term, that means more integrations, more partnerships, and continued focus on deepening relationships within the insurance industry. "It's just the beginning here at Re."
Watch the full conversation on YouTube: https://www.youtube.com/watch?v=IcB2tmbMQSk
#reinsurance #RWA #TradFi
Sources
1. https://x.com/karnsaroya
2. https://x.com/therollupco
3. https://app.re.xyz/metrics
4. https://re.xyz/insights/half-billion-milestone
5. https://www.akur8.com/blog/agentic-ai-for-actuaries-what-it-is-and-why-it-matters
Important Disclosures
About Re and Cover Re. "Re" refers to the Re Protocol, onchain infrastructure operated in connection with Resilience Foundation Cayman LLC ("Resilience Foundation"), an Exempted Limited Guarantee Foundation Company incorporated in the Cayman Islands with Limited Liability with registered number IC-414560, and its affiliates (including Resilience BVI and Resilience Inv). "Cover Re" refers to Cover Re SPC, a separately regulated reinsurance entity. Re and Cover Re are distinct brands operated by separate legal entities with separate functions, terms, and regulatory regimes. References to reinsurance treaties, insurance partners, policyholders reinsured, business written, or book size refer to activities of Cover Re SPC, not the Re Protocol. References to onchain capital, the protocol, and token-related activity refer to the Re Protocol.
No offer; eligibility restrictions. This article is for informational purposes only. It does not constitute an offer to sell, or a solicitation of an offer to buy, any security, token, insurance product, or reinsurance capacity, and is not investment, legal, tax, accounting, or financial advice. reUSD and reUSDe are available only to non-U.S. persons in specific geographies through Resilience Foundation and are subject to eligibility screening, including KYC/AML procedures. Nothing in this article should be read as making any product or token available to any person in a jurisdiction where such offering would be unlawful.
Risk. Participation in the Re Protocol and holding of digital assets, including reUSD and reUSDe, involve significant risk, including risk of total loss of principal, smart contract vulnerabilities, regulatory risk, liquidity risk, counterparty risk, and reinsurance underwriting risk. APR, yields, and returns are not guaranteed. Past performance is not a reliable indicator of future results. Any historical figures referenced reflect data over the period stated and are not projections.
Forward-looking statements. Statements regarding the partnership, planned functionality, future governance phases, or other future events are forward-looking and based on current expectations. Actual results may differ materially. Re, Cover Re, and their affiliates undertake no obligation to update any forward-looking statements.
Regulatory environment. The legal and regulatory treatment of digital assets, governance tokens, stablecoins, and onchain reinsurance is evolving. This article reflects our understanding as of the date of publication and may not reflect subsequent legal or regulatory developments, including any further guidance under the joint SEC/CFTC Interpretive Release (Release No. 33-11412; 34-105020; File No. S7-2026-09). Readers should consult qualified legal, tax, and financial professionals before making any decisions.
Additional information. For full Terms of Service, Privacy Policy, eligibility criteria, KYC/AML information, and detailed risk disclosures, see our Terms of Service (https://re.xyz/terms), Privacy Policy (https://re.xyz/privacy), and Risk Disclosures (https://re.xyz/disclosure).

Reinsurance is insurance for primary insurers: the companies that bring you auto, property, and business coverage. Protection from financial crisis is only part of the story; reinsurance is structural to the entire insurance industry.
You buy insurance to protect yourself financially from extreme events. Insurers need similar protection for their own financial well-being. So what is the full set of benefits that make reinsurance such an essential asset to insurers, and such a strong financial market in its own right?
Protection From Extreme Scenarios: A backstop when even well-supported projections turn out wrong.Earnings Stability: Smoother, more predictable year-to-year results.Access to Reinsurer Resources: Perspective, experience, and an established network insurers can't always build alone.Maximizing Capital Efficiency: Freeing up capital that would otherwise sit idle against regulatory requirements.
Protection From Extreme Scenarios
Insurance is an inherently volatile business. Though insurers base operational decisions on decades of historical data and a great deal of math, even the most well-supported projection on the outcome of any given policy is still just that: a projection. This is especially true for more volatile categories such as catastrophe insurance.
Take hurricane insurance as an example. An insurer may rightly project an unprecedentedly heavy hurricane season to be highly unlikely, and issue policies accordingly. But even deeply unlikely scenarios can ultimately manifest, with the potential for severe financial consequences.
2004 saw four hurricanes make landfall in Florida in a mere six weeks, inflicting $20 billion in insured losses ($35 billion in 2026 dollars) across approximately 1.5 million claims [1]. Hurricane Katrina alone caused around $65 billion in insured losses in 2005, more than $100 billion in today's dollars [2]. California's 2017 and 2018 wildfire seasons inflicted losses roughly double the underwriting profits that California insurers had accumulated over the previous two decades [3].
If insurers didn't pass on risk to reinsurers, events of this sort could inflict dire financial consequences upon the insurers involved. Losses on that scale can deplete an insurer's capital or, in extreme cases, threaten its solvency altogether. And should the insurer fail, the policyholders hit by those same events may be left with claims the insurer can no longer pay. Reinsurance is structural to protection from such scenarios.
Earnings Stability
Reinsurance doesn't merely provide protection from the most extreme outcomes. Even absent unusually severe scenarios, insurance earnings are inherently volatile; though premiums are known, claims can never be predicted with a sure degree of accuracy. Even across large, diversified portfolios, actual claims can deviate substantially from projections.
Volatile annual earnings make for a lack of predictability, and financial predictability is a valuable asset for any business. By limiting the extremity of potential outcomes, reinsurance helps to smooth out an insurer's earnings, producing steadier year-to-year results.
Access to Reinsurer Resources
Beyond protection and stability, reinsurers bring assets an insurer can't always easily build alone: perspective, experience, and an established network. Reinsurers work across hundreds of programs and lines of business simultaneously, and that breadth of experience gives them a depth of knowledge that most primary insurers can't match internally. Smaller or newer insurers in particular benefit from working with reinsurers who understand how to price and manage risks they're encountering for the first time.
When an insurer wants to enter a new line of business or a new geography, reinsurance makes that significantly less risky. By partnering with a reinsurer that's already established in that market, the insurer can write new business with a safety net in place while it builds its own experience base.
Maximizing Capital Efficiency
Optimizing economics is perhaps the least-known benefit of reinsurance to the non-industry native. But it's arguably the most desirable benefit for insurers.
Like any for-profit business, the primary goal of most insurers is to maximize growth and profits in order to maximize shareholder value. In insurance, growth is substantially tied to capital requirements. If an insurer wants to grow, it has to raise more capital. Enterprises typically raise capital either by issuing equity or taking on debt. Both come with a cost: lessening the value of the shares owned by existing shareholders and incurring interest expenses through taking on debt, respectively. Insurers are required by law to hold a cushion of capital proportional to the risk they take on, so that they can pay claims even in extreme scenarios. This means tying up a great deal of capital that could otherwise be used for growth. By buying reinsurance and transferring risk to reinsurers, insurers lessen the capital requirements imposed upon them by regulators.
This frees up capital to:
Grow more and write more business without raising as much capitalGenerate higher returns for shareholdersCreate flexibility during difficult market conditions, especially when other insurers may have less capital
Say an insurer writes $100 million in policies and regulators require it to hold $25 million in capital against that book. If the insurer transfers half of that risk to a reinsurer, much of the associated capital requirement moves with it, freeing up capital the insurer can now put toward writing new business. In effect, the insurer frees up capital it would otherwise have had to raise, and the premium it pays for that relief is often less than what raising the equivalent capital in equity or debt would have cost.
In short, reinsurance is a distinctive tool for optimizing business economics for which few other industries have an equivalent. The best insurers aren't just masters of their industry; they're also those who are most strategic with leveraging reinsurance to maximize growth and profit.
The Market It All Creates
Every insurer faces the same pressures, making the market for reinsurance both strong and steady. A combination of persistent demand with limited supply is what makes reinsurance such a significant financial market. Reinsurance has quietly grown into one of finance's largest markets for decades: global reinsurance capital reached a record $648 billion at the end of 2025 [4].
Its returns come from real premiums paid to take on risk, priced on decades of loss data rather than speculation, and the industry has been profitable in most years. Because reinsurance returns are driven by real-world events rather than market swings, they are largely uncorrelated with the performance of other markets such as stocks, bonds, and crypto.
Historically, access to that market has been the preserve of a handful of large reinsurers and specialist funds. Re is built to change that by connecting onchain capital to reinsurance risk that was once reachable only by a narrow set of institutions.
Learn More
For more information on the protocol, visit our official docs: docs.re.xyz
Sources
[1] GAO-05-199 Catastrophe Risk: U.S. and European Approaches to Insure Natural Catastrophe and Terrorism Risks: https://www.gao.gov/assets/gao-05-199.pdf
[2] Hurricane Katrina: a watershed event for insurance | Swiss Re: https://www.swissre.com/institute/research/topics-and-risk-dialogues/climate-and-natural-catastrophe-risk/hurricane-katrina-watershed-event-for-insurance.html
[3] Homeowners Insurance and California Wildfires | Congress.gov | Library of Congress: https://www.congress.gov/crs-product/IN12491
[4] Reinsurance Market Report: Results for Full-Year 2025 | Gallagher Re: https://www.ajg.com/gallagherre/news-and-insights/reinsurance-market-report-results-for-full-year-2025/
#reinsurance #RWA #TradFi #insurance
Disclosures
This post is for informational and educational purposes only and does not constitute investment, legal, tax, or financial advice. Nothing in this article should be construed as an offer or solicitation to buy or sell any security, token, or financial product.
Affiliate disclosure. The "re" brand, the re protocol, and re.xyz are operated by Resilience Foundation Cayman LLC ("Resilience Foundation"), an Exempted Limited Guarantee Foundation Company incorporated in the Cayman Islands with Limited Liability with registered number IC-414560, together with its affiliate Resilience (BVI) Ltd and Resilience Inv SPC. Resilience Foundation, Resilience BVI, and Resilience Inv do not provide insurance or reinsurance services, do not act as insurance broker or agent, and do not hold an insurance license. All regulated reinsurance activities are conducted exclusively by Cover Reinsurance SPC Ltd. ("Cover Re SPC"), a Class B(iii) licensed exempted segregated portfolio company in the Cayman Islands, operating under the "Cover Re" brand at coverre.com.
Risk disclosure. Digital assets and blockchain-based products involve significant risk, including the potential loss of principal, smart contract vulnerabilities, liquidity constraints, and regulatory uncertainty. Any references to APR, returns, or performance are not guaranteed, and past performance is not a reliable indicator of future results.
Risk note. Uncorrelated does not mean risk-free. As the extreme-scenario losses described in this post illustrate, reinsurance underwriting results can and do turn negative in severe years. Returns are not guaranteed, capital can be lost, and past performance, including the historical profitability described in this post, is not a reliable indicator of future results.
Regulatory environment. The regulatory environment for digital assets, stablecoins, tokenized real-world assets, and onchain financial products is dynamic and continues to evolve across jurisdictions. The information in this post reflects the understanding as of the date of publication and may not reflect subsequent legal or regulatory developments. Readers should consult qualified legal, tax, and financial professionals before making any decisions.
Terms apply. For full terms, disclosures, and risk disclaimers, please see the Re website (re.xyz), Terms of Service (https://re.xyz/terms), and Disclaimers (https://re.xyz/disclosure).