Global broker Marsh and We2Sure, a specialist in insurance solutions for carbon credit certificates, have launched an insurance facility designed to help organisations in the UK, EU, and US manage the increasing risks related to carbon credit certificate fraud.
Carbon credits, used by businesses to offset carbon dioxide emissions, are becoming a target for fraud, with counterfeit certificates and fake project claims on the rise.
The new facility, backed by insurers Sompo, Brit, and Talbot, provides coverage for risks associated with purchasing counterfeit certificates, certificates linked to non-existent projects, and theft. Additionally, the facility grants businesses access to We2Sure’s technology, which assesses certificate validity before purchase.
Using CarbonActuator, We2Sure said that it can detect duplicate and counterfeit certificates, while its satellite and AI technology monitors projects in real time to identify those failing to meet predetermined standards.
Rupert Poland (pictured above), UK digital asset leader at Marsh, noted that with businesses increasingly using carbon credits to meet net-zero targets, they are exposed to fraud risks in a market that lacks standardisation and transparency.
“This new facility will not only help de-risk investments for businesses from a financial and reputational perspective, but also support the integrity and expansion of the wider carbon credit ecosystem,” Poland said.
Simon Wigzell, head of business development and underwriting at We2Sure, stated that their verification process addresses the critical authenticity issue in carbon credits, helping reduce reputational risks for buyers.
“This transformative solution establishes a robust integrity standard, effectively converting intangible carbon credits into tangible assets, thereby enabling corporations to invest with greater confidence,” Wigzell said.
Earlier this year, global insurer Tokio Marine Kiln (TMK) also announced a partnership with Kita, another carbon credit insurance specialist, to provide political risk insurance for developers and investors in carbon credit projects.
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