Former Allianz executives raise $12m for carbon credit insurance
Carbon credit insurer CarbonPool has secured $12 million from investors, including former executives of insurance giant Allianz, to underwrite the carbon credit markets.
The funding is said to be the largest European climate finance seed funding round in more than a year.
Founded by former Allianz executives Coenraad Vrolijk, Nandini Wilcke and Frederic Olbert, CarbonPool aims to accelerate investment in carbon credits, which it says are crucial to achieving net zero, by providing carbon credit insurance with claims payments made in-kind.
The Zurich-based company has closed a CHF 10.5 million ($12 million) funding round, co-led by Heartcore Capital and Vorwerk Ventures and included HCS Capital, Revent Ventures and former members of the management board of Allianz, Axel Theis and Christof Mascher.
CarbonPool explained that companies planning to hit net zero emissions by 2030 depend on carbon credits to reach their net zero goals. But after considerable turbulence in carbon credit markets, credit integrity, proper risk underwriting and certainty of outcomes are critical to reassure investors, regulators, and other stakeholders that these promises represent real environmental gains.
CarbonPool’s insurance license application is underway in Switzerland, and the company is already offering assessments and pre-underwriting agreements to clients including corporations, institutional investors, and carbon removal developers. The company stated that it is also in conversation with government bodies, including the United Nations and the State of California, sharing perspectives on how insurance can solve some of the industry’s key challenges, such as securing the permanence of carbon removals from the atmosphere.
Vrolijk, former regional CEO of Allianz Africa and CarbonPool’s co-founder and chief executive, said: “CarbonPool’s in-kind payments make it unique among insurers in not only offering protection to holders of carbon credits in cases of natural disaster or technology breakdown, but also in providing a guarantee that carbon credits live up to their promises, giving purchasers certainty and ensuring that they can meet their net zero goals.”
Christian Jepsen, a founding partner at Heartcore, said: “Insurance represents 5-10 percent of revenue of most mature markets, yet it has only just begun to touch carbon trading. This is a space that desperately needs the credibility that established financial controls like insurance can offer. We are excited to be backing a world-class team of climate scientists, carbon specialists and most uniquely, insurance experts with a combined 60 years of experience in global underwriting. I’m confident they will bring much-needed professionalisation to this sector.”
Dominik Steinkühler, partner at Vorwerk Ventures, said: “CarbonPool’s offering gives buyers, developers and investors in carbon dioxide projects the confidence needed to invest at scale and build the carbon removal industry we need. We have been consistently impressed by the expertise and the track record of the CarbonPool founders and we’re excited to back such an ambitious and purpose-driven team. Their innovative in-kind approach extends beyond typical business insurance, safeguarding Earth’s CO2 balance sheet.”
Alex Horvitz, CEO of HCS Capital, commented: “We are very excited to invest in CarbonPool. As a VC with a deep focus on insurtech, we believe in the power of innovation to address the pressing challenges of our time, and CarbonPool’s commitment to mitigating climate-related risks aligns perfectly with our vision for the future of the insurance industry.”
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