> For the complete documentation index, see [llms.txt](https://docs.noon.capital/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.noon.capital/5.-the-security-framework/layered-insurance/detail-on-chain-smart-contract-cover.md).

# Detail: On-Chain Smart Contract Cover

<mark style="color:purple;">**Noon**</mark> purchases on-chain smart contract covers against specified losses on the following DeFi deployments:

* DeFi Lending
* Principle Tokens
* Looping

Details like ownership, cover amounts and coverage dates can be independently verified on Ethereum. Cover ratio (<mark style="color:purple;">**Noon**</mark>'s Full Cover Exposure v. Current Covered Exposure) is also tracked by <mark style="color:purple;">**Noon**</mark>'s third-party verification partners, like Accountable ([**here**](https://noon.accountable.capital/)).

<mark style="color:purple;">**Noon**</mark> uses **Nexus Mutual**'s Generalised Fund Portfolio Cover (FPC) product to combine specified DeFi deployments under one portfolio-level cover. The protocols covered under <mark style="color:purple;">**Noon**</mark>'s FPC policy are updated regularly, to reflect <mark style="color:purple;">**Noon**</mark>'s current deployments.

**Nexus Mutual**'s FPC policy allows protocols like <mark style="color:purple;">**Noon**</mark> to cover a larger amount of total exposure (Full Cover Exposure) across separate, uncorrelated DeFi protocols, and keep insurance premium cost-effective by capping the maximum cover payout.

*Note: <mark style="color:purple;">**Noon**</mark> bears the risk of these uncorrelated DeFi protocols being compromised simultaneously.*

## <mark style="color:$primary;">**Definitions**</mark>

There are several key definitions to understand:

* **Full Cover Exposure:** Maximum amount of deployment exposure covered by the **Nexus Mutual** policies
* **Current Covered Exposure:** Total amount of <mark style="color:purple;">**Noon**</mark>'s current DeFi deployments covered by the **Nexus Mutual** policies
* **Maximum Cover Payout:** Maximum payout from **Nexus Mutual** policies

## <mark style="color:$primary;">**Coverage Wallet**</mark>

The below wallet purchases cover and holds the Cover NFTs for <mark style="color:purple;">**Noon**</mark>:

`0x533a2019d0e0998D3bf558D0784CA49115B04686`

The purchasing wallet is separate from the wallets deploying capital. The general terms of the **Nexus Mutual** policy ([**here**](https://api.nexusmutual.io/v2/ipfs/Qma8uAzUDYaNFofu6VuQ5kSYq4b9rF49o3PLTQdXZAVSKU)) and annex for <mark style="color:purple;">**Noon**</mark>'s specific FPC policy ([**here**](https://api.nexusmutual.io/v2/ipfs/QmZSUZshS2RNNgTgfnjmcJGt4AGg2pNNfeaoN5G8rAwxKs)) determine which deployments are covered.

## <mark style="color:$primary;">**FPC Coverage Details**</mark>

Nexus Generalized Fund Portfolio Cover (FPC) combines specified DeFi deployments under one portfolio-level cover.

The current Noon DeFi Deployment 2 annex ([**here**](https://api.nexusmutual.io/v2/ipfs/QmZSUZshS2RNNgTgfnjmcJGt4AGg2pNNfeaoN5G8rAwxKs)) sets the Cover Amount at 50% of AUM, with a 3% of AUM deductible, as defined in the terms.

> Portfolio AUM (Full Cover Exposure) represented = Cover Amount (Maximum Cover Payout) ÷ 50% = Cover Amount (Maximum Cover Payout) × 2.

The 2× conversion describes portfolio AUM, or the Full Coverage Exposure. The maximum aggregate payout remains the Cover Amount (Maximum Cover Payout), subject to the terms, deductible and claim approval.