Insurance broker and risk advisor Marsh, in collaboration with We2Sure, has launched a new insurance facility to assist organisations in the EU, UK and US to mitigate the increasing risks related to carbon credit certificate fraud.
The facility offers protection against the risk of buying counterfeit certificates, sales of non-existent project certificates and theft.
Carbon credits are increasingly used by businesses to counterbalance their carbon dioxide emissions.
However, the industry is facing a surge in fraudulent activities in the shape of counterfeit carbon credit certificates, or certificates for non-existent projects.
This new facility, backed by insurers Sompo, Brit and Talbot, provides a safeguard for businesses against these fraudulent practices.
Marsh UK digital asset leader Rupert Poland said: “Businesses are increasingly using carbon credits as a core element of their strategy to meet net-zero targets, and this leaves them exposed to fraudsters seeking to take advantage of this growing market.
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“The lack of standardisation and transparency in the market makes it difficult for businesses to assess the legitimacy of the carbon credits they are buying.”
The insurance offering is bolstered by We2Sure’s CarbonActuator technology, which is designed to detect duplicate and counterfeit certificates.
Additionally, We2Sure deploys satellite and AI technology to monitor and evaluate projects in real time, ensuring they adhere to pre-determined standards and accurately represent the certificates issued.
We2Sure Business Development and Underwriting head Simon Wigzell said: “Our data-backed verification process addresses the critical issue of authenticity in carbon credit certificates, substantially reducing 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.”
Last month, Marsh appointed Will Thomas-Ferrand as head of its captive insurance business, effective from 1 January 2025.
Marsh is part of Marsh McLennan, which serves clients in 130 countries through its four businesses: Guy Carpenter, Mercer and Oliver Wyman, in addition to Marsh.
Marsh McLennan generates annual revenue of $23bn and employs more than 85,000 people.
