Artio Breaks New Ground in Carbon Project Insurance
Artio has achieved a significant milestone by becoming the first insurer approved by Lloyd’s to underwrite carbon projects at their earliest stages. This development aims to address a critical barrier to investment in climate solutions. Backed by prominent insurers such as Tokio Marine HCC, Markel, and Apollo, Artio is now positioned to provide insurance coverage for carbon projects globally, facilitating capital flow into initiatives supporting global net-zero goals.
The carbon market, projected to reach $100 billion annually between 2030 and 2035, has faced challenges in securing early-stage investment. In 2024, estimates indicate that $16 billion was invested, with growth expected in the coming years. However, the lack of appropriate insurance coverage for early-stage investments has hindered projects from securing necessary funding.
Founded by experts with backgrounds at Bloomberg, Deloitte, and Sylvera, Artio has developed a proprietary risk model to assess risks associated with carbon projects before they commence. This model enables the insurer to cover risks such as credit under-delivery arising from financial, climate, political, or methodological factors. Bilal Hussain, Artio’s co-founder and CEO, stated, “Carbon buyers are ready to back high-quality climate solutions, but uncertainty at the earliest stages continues to hold back critical capital flows. By providing cover before projects even begin, we’re helping create the conditions needed to accelerate the scaling of this market.”
Lloyd’s coverholder status empowers Artio to write coverage on behalf of the Lloyd’s market, enhancing its capacity to support the growth of early-stage carbon investments. Currently, Artio provides coverage for Afforestation, Reforestation, and Revegetation (ARR) projects, which involve planting trees and restoring land through soil conservation practices. It also covers biochar projects that transform waste into material enhancing soil while sequestering carbon. The company plans to expand its coverage to include direct air capture (DAC) and enhanced rock weathering (ERW) projects by 2025.
Artio’s role in the carbon market is part of an emerging trend among insurers. Companies like Aviva, AIG, Zurich, and Markel are exploring ways to offer coverage for carbon offset and renewable energy projects. While some focus on more mature initiatives, others, including Artio, are addressing the need for coverage in the early stages of carbon projects.
