The stablecoin depeg protection protects you against deviations in the target 1:1 ratio between stablecoins and their underlying asset (e.g. 1 USDC or USDT should equal 1 USD).

Example: Suppose you receive a $100 bill payable in USDC. If, at the time of payment, the stablecoin depegs, making 1 USDC equal to 0.5 USD, you would have to pay 200 USDC instead of the expected 100 USDC if USDC was at peg.

In this case, if the stablecoin protection fails to notify you of the depeg and the bill is settled at a 100 USDC loss (200 USDC paid instead of the expected 100 USDC), you could claim 100 USDC accordingly.