eToro introduces a free insurance policy for its clients
A further level of protection for investing with eToro.
Good news for those who own a trading account with eToro. In fact, starting from 1st November 2020, all eToro clients will benefit from an additional insurance policy, which will protect each user up to a maximum of 1 million euros. The insurance will also apply for all the new users.
How it works
Every investor who has an eToro account has always been protected by the European investor compensation scheme (find out more about eToro account security). In the event of the broker’s insolvency problems, each client is insured up to a maximum of 20.000 euros.
This maximum level of protection of €20.000 represented an obstacle to anyone who wanted to trade with higher figures. In the event of eToro’s default, in fact, there would have been a potential risk of insolvency.
With this new insurance policy taken out with Lloyd’s of London, each customer is potentially protected up to 1 million euros. The object of the protection is the liquidity of the clients and the financial products held by them on the eToro platform: CFDs, shares, ETFs. Real cryptocurrencies purchased on eToro and held in the wallet are not included in the insurance.
The policy covers the losses due to the occurrence of several scenarios: eToro’s unlikely bankruptcy declaration; the misconduct of eToro or of its employees causing financial loss to the customer; the theft of financial instruments.
If at least one of these events occurs, each customer can request compensation up to a maximum of 1 million euros. It can be done just by filling out an online form that will be sent directly to Lloyd's.
Needless to say, the policy does not cover losses arising from trading activities, or rather those losses due to negative fluctuations in the financial products owned by customers.
The new eToro insurance policy does not have an expiration date and it is free for all clients (even the new ones).
Risk disclosure: Investing involves risk of loss
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