CarbonPool, emerging as the world’s first insurance company with a carbon credit balance sheet, has successfully concluded a $12 million funding round. The company plays a crucial role in the growing reliance on carbon credits to achieve net-zero goals. CarbonPool provides in-kind insurance to address potential failures in meeting net-zero commitments due to various factors such as shortfalls, reversals, business interruptions, and natural disasters.
What sets CarbonPool apart is its unique approach to in-kind payments, ensuring that it not only offers protection in cases of natural disasters or technological breakdowns but also guarantees that carbon credits live up to their promises.
The funding round was co-led by Heartcore Capital and Vorwerk Ventures, with participation from HCS Capital, Revent Ventures, and notable figures from Allianz, including Axel Theis and Christof Mascher. The total funding will contribute to CarbonPool’s efforts to obtain an insurance license in Switzerland, a crucial step in expanding its operations.
The company’s risk assessment process involves a multidisciplinary team of insurance experts, climate scientists, weather modelers, geographers, and engineers. Together, they create bespoke risk models to evaluate and address the various challenges that may affect carbon dioxide removals. Premiums collected from clients are strategically invested, alongside CarbonPool’s own capital, into high-quality carbon removal projects. This approach not only secures the necessary funds for claims payments but also reinforces the commitment to environmental impact.
CarbonPool is already engaging with clients, including corporations, institutional investors, and carbon removal developers, offering assessments and pre-underwriting agreements. Additionally, the company is in discussions with governmental bodies, such as the United Nations and the State of California, to explore how insurance can play a pivotal role in addressing key challenges in the industry, including ensuring the permanence of carbon removals from the atmosphere. As the company navigates the regulatory landscape and expands its offerings, it aims to provide credibility and financial controls to the carbon trading space, ultimately contributing to the broader goal of achieving a sustainable and net-zero future.