Security issuance provider PrefLogic and insurtech start-up Assurely have teamed up to integrate insurance into security token issuance tools to create a safer, more trustworthy marketplace.

PrefLogic will use a new type of insurance created by Assurely and work to integrate their TigerMark insurance policy into its platform to benefit both the issuers of and the investors in digital securities.

PrefLogic founder Todd Wier said: “The introduction of digital securities represents technological advancement and change.

“Change always courts a level of uneasiness. We believe an insurance policy that can provide benefit to both the issuer and investor would help to ease doubts surrounding this modern investment instrument.”

PrefLogic’s security token issuance software, STO Wizard, will enable SME’s and individuals seeking to provide digital securities in search of the capital required to drive their business goals.

Simultaneously, Assurely’s TigerMark insurance policy will work in tandem with PrefLogic to benefit both issuing companies and their investors participating in security token offerings.

Using Assurely’s TigerMark policy, security token issuers can safeguard themselves from covered investor complaints and legal attacks.

Additionally, it will enable investors to use Assurely’s claims process.

Assurely CEO David Carpentier said: “PrefLogic’s STO Wizard is at the core of innovation in capital markets and capital raising.

“Through integrating with PrefLogic, we are hitting at the core of what insurance was created to do, advance commerce and business.

“We are excited about this partnership and its significance. It combines the ease of use when raising money with the trust, safety, and confidence that healthy marketplaces and industries need to thrive.”

PrefLogic founder Todd Wier said: “Security tokens are a powerful instrument that SME’s and individuals can use to gain access to the capital they need. Integrating insurance into the transaction should promote investor confidence and further evolve the space.”

PrefLogic’s STO Wizard is scheduled to go live later this year, while Assurely’s insurance component available at the issuer’s option.