Frequently Asked Questions

What is CrowdCover?

CrowdCover uses prediction markets to offer coverage for real-world events. Instead of traditional insurance pricing, your premium is based on actual market odds determined by thousands of participants worldwide.

How is this different from insurance?

Traditional insurance uses internal actuarial models and adds significant overhead. CrowdCover prices coverage at market odds plus a small spread — often significantly less than traditional insurance premiums.

How do payouts work?

When a covered event occurs (verified by prediction market resolution), your payout is automatic. No claims adjusters, no paperwork, no waiting months for approval.

What events can I cover?

We curate events across natural disasters, economic shifts, employment changes, policy/regulatory changes, health events, geopolitical risks, and more. We deliberately exclude novelty bets and speculation — only real risks that affect real lives and finances.

Is this gambling?

It's the exact opposite. Gambling means taking on risk you don't have, hoping for a payout. Hedging means reducing risk you already carry. If you live in wildfire country, own a business affected by tariffs, or work in an industry facing layoffs — you already have that risk. CrowdCover doesn't create uncertainty; it shores it up.

How are odds determined?

Odds come from real prediction markets where thousands of participants price risk in real time. These markets often prove more accurate than expert forecasts.

What if the market is wrong?

Markets aren't perfect, but they're remarkably good at pricing probability. And unlike insurance, if you think an event is underpriced by the market, that's an opportunity — you get better odds.

Is my money safe?

Funds are held in regulated accounts until events resolve. We never bet against you — we're a platform, not a counterparty. When you win, you get paid.

What's the minimum coverage?

You can start with as little as $100 in coverage. Scale up as you get comfortable with the platform and want more protection.

Is this legal?

CrowdCover operates within the regulatory framework for prediction markets and structured financial products. We're building the future of risk transfer, working with regulators to expand access.

Can businesses use CrowdCover?

Absolutely. Hedge supply chain risks, policy changes, market conditions, and more. Enterprise coverage coming soon.

How do I get started?

Join the waitlist. Once we launch, you'll browse coverage categories, find events relevant to your risks, set your coverage amount, and you're protected.

What about taxes on the payout?

Fair question — and yes, there's a real tax difference. Prediction market payouts are currently taxed as ordinary income. Traditional insurance payouts for property damage aren't taxed at all.

But the tax delta matters less than it sounds when you remember CrowdCover is a different product entirely. For an earthquake example: traditional CA earthquake insurance settles in 12–18 months and eventually pays for the structural repair. CrowdCover Earthquake Bridge pays $15K within a week of USGS reporting M7.0+ — for hotel, food, school transitions, child care while the family is displaced. After tax, you net ~$10K. Insurance writes the repair check eventually. CrowdCover writes the displacement check now.

It's the first 4–8 weeks of cash, not the repair money. Different product, different timing.

Looking ahead: We're actively exploring a licensed parametric insurance structure — similar to how Jumpstart (acquired by Neptune Flood) uses USGS data to trigger tax-advantaged earthquake payouts. That path would qualify CrowdCover payouts for insurance tax treatment. It's a 12-18 month regulatory journey requiring surplus lines licensing and a reinsurance partner.

Not tax advice. Talk to a CPA about your specific situation.