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Documentation Index

Fetch the complete documentation index at: https://kamino.com/docs/llms.txt

Use this file to discover all available pages before exploring further.

The Insurance Pool is the strongest trust signal you can offer depositors. Your locked capital absorbs losses before any depositor takes a hit, with public on-chain visibility of the amount. Kamino matches your deposit up to $250K. For the conceptual treatment of the loss waterfall and the emergency withdrawal model, read Risk primitives → Insurance Pool first. This page is the operational walkthrough.

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Before you start

You’ll need:
  • An existing vault. If you haven’t created one yet, see Create a vault.
  • The capital you want to lock as the backstop, in the vault’s deposit token.
  • A multisig wallet you want to nominate for the emergency-withdrawal 2-of-2 (Kamino’s security council is the other signer).

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Setup steps

1

Create the Insurance Pool farm

The Insurance Pool is implemented as a dedicated farm on your vault (the FirstLossCapitalFarm). If your vault was created via the SDK with the standard createVaultIxs flow, the farm was created automatically. If not, create it now.
MethodHow
UIAvailable under your vault’s Insurance Pool / First Loss Capital settings
SDKUse kaminoManager.createVaultFarmIxs(...) and kaminoManager.updateVaultFirstLossCapitalFarmIxs(...) to create the farm and register it on the vault. See Configure farms for the exact instruction sequence.
CLINot currently supported. Use UI or SDK.
2

Configure the deposit token

Set the asset you’ll deposit. For most vaults this is the same as the vault’s deposit token, so your backstop is denominated in the same currency you’re protecting.
3

Deposit your capital

Deposit into the Insurance Pool. You receive vault shares (kTokens) which are staked into the pool. The deposited amount is visible on-chain and surfaces on Kamino’s UI as a public commitment.
4

Transfer farm authority to a multisig

After creation, transfer farm ownership to a multisig and add Kamino as a co-signer for emergency operations. This sets up the 2-of-2 model for emergency withdrawals.
5

Trigger the Kamino match

Kamino matches curator Insurance Pool deposits up to 250K.Ifyoudeposit250K. If you deposit 200K, Kamino contributes 200K,bringingthepoolto200K, bringing the pool to 400K. The match is triggered through Kamino — contact your curator-relations point of contact when your deposit is ready.

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Withdrawal mechanisms

Two paths exist; understanding both is important because they serve fundamentally different purposes.

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Normal withdrawal — 30-day cooldown

Initiate a standard withdrawal to remove your insurance commitment. The mandatory 30-day cooldown begins when you initiate; the withdrawal is a public, on-chain signal. Depositors and anyone monitoring the vault see that you’re exiting. This is the expected path for curators winding down their commitment. The 30-day window gives depositors time to assess and react.

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Emergency withdrawal — instant, 2-of-2 multisig

Emergency withdrawal exists for one purpose: rapidly accessing Insurance Pool funds to compensate depositors after a loss event. It bypasses the cooldown. The 2-of-2 multisig:
  1. Your curator-controlled wallet
  2. Kamino’s security council
Both must sign. Kamino’s security council co-signs only when the withdrawal is for legitimate depositor compensation.
Using emergency withdrawal to extract funds and avoid compensating depositors — rather than to make them whole — defeats the Insurance Pool’s purpose and constitutes a breach of the curator commitment.

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The loss compensation flow

When the vault incurs bad debt, compensation is manual — there is no automated on-chain detection. Process:
  1. Loss is socialized. Kamino calls socialize_loss on klend; depositors take the hit.
  2. Assess impact. Identify which reserve was affected and the loss magnitude.
  3. Release Insurance Pool funds. Normal withdrawal (30-day cooldown) or emergency withdrawal (2-of-2) if urgency is needed.
  4. Snapshot affected depositors at the loss timestamp.
  5. Distribute compensation to affected depositors.
For the full flow, see Risk primitives → Loss compensation flow.

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Best practices

  • Run alongside Whitelisted Reserves. The two protect different things — together they’re the highest trust configuration. See Enable Whitelisted Reserves.
  • Set up before depositors enter. A vault with an established Insurance Pool from launch is more credible than one that adds it later.
  • Size the pool to depositor expectations. Institutional depositors will look at pool depth as a fraction of vault TVL when assessing risk.

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What’s next

Risk primitives

The model behind the Insurance Pool and Whitelisted Reserves.

Enable Whitelisted Reserves

The complementary protection — restrict where vault capital can go.