Every time when there is a system rebase where the Reserve Pool contains excess collateral relative to the market cap of OURO, 50% of the funds that will be used to serve the OGS token will be converted to stablecoins and be stored in an address that is publically visible. In the future, the Insurance Fund might also partly store and utilize synthetic inverse index tokens.
The Insurance Fund is practically a "buyer of last resort" fund. This will be typically utilized to aid OGS when the market is volatile, and the system needs to acquire large amounts of different assets to make sure a 1-1 peg between the market cap of OURO and that of the collateral in the Reserve Pool.
Though this fund is mainly designed as a failsafe to the mechanism which mints new OGS tokens to acquire assets on secondary markets, it might also be used for the compensation of any security or economic incidents.