Jay Westerdal has been a consistent innovator in the domain name industry, and now he’s come up with another good idea: insurance for domain names. You might think this sounds bizarre – insurance for something that costs $6.95 a year? Consider two factors, however, and it begins to make sense:
1. The skyrocketing value of premium generic domain names in recent years.
2. The development of a new criminal industry to steal or hijack those domains.
Jay, a 29 year old computer science graduate from Washington state, is CEO of the domain name registrar Name Intelligence, Inc., and founder of the Domain Roundtable and DomainTools.com. On his DomainTools.com blog, Jay has recently been reporting on an alarming trend: domain theft.
So in a recent blog post, he’s announced that in response to the recent hijacking or theft of several valuable generic domain names, Name Intelligence will now offer insurance for any high-value domain hosted by them. $100 per year, for example, will get you $100,000 in coverage. Furthermore, if your domain is insured at that level and is stolen, Jay will pay you $1,000 a day until it is recovered. Jay is confident, however, that no domain under his protection will ever be stolen, because he will maintain a high level of contact with the owner.
Right now Jay’s just one guy out there on his own looking brash, and I suspect that some registrars are looking askance, wondering why he would take on such a risk. But that’s how innovation happens. If the other registrars don’t rise to meet the challenge posed by new security threats, they could very well begin losing business to those who do.
What you’re seeing is the birth of a concept. Prediction: within a few years, Moniker, GoDaddy and perhaps some others will begin offering a “high security” domain hosting package for a fee, and an insurance plan for premium domains, for another hefty fee. Homes are insured. Businesses are insured. A premium domain name can be worth much more than most homes. Insurance is an obvious next step.
I see this as a sign of the continuing maturation of the domain name industry. The industry is having to face certain rude realities (like become a target for fraud) and must implement real-world solutions.