Howden has announced the placement of what is thought to be the first carbon credits warranty and indemnity insurance policy. The W&I policy provided insurance cover on the sale of carbon credits for the reforestation project of degraded forest lands by Mere Plantations, a UK-based company that owns and operates a teak plantation in Ghana, West Africa.

The demand for high-quality credits is strong and by using insurance as a governance mechanism, the W&I policy increases the integrity and value of the carbon credits.

Charlie Pool, head of carbon insurance, Howden, said: “The carbon markets are the best tool we have for putting a price on emissions. Traditionally held back by poor governance, the voluntary market can now be improved using market-based mechanisms. With insurance guaranteeing the credibility of carbon credits, this product will ensure credits attract a higher value and encourage further project development. By addressing the lack of trust and transparency, this innovative policy introduces a much-needed structural improvement and represents a significant step forward on behalf of clients.”

Mark Hogg, CEO, Mere Plantations, added: "Our ultimate goal at Mere Plantations has been to demonstrate how reestablishing degraded forest land can be a viable, stand alone commercial enterprise without any need for aid or government intervention. Working with Howden to launch this first-of-its kind insurance offer, we are now poised to unlock the potential of the carbon market and achieve that mission. We are proud to offer our customers access to our high-quality offsets with full confidence that the carbon credits they purchase from us are legitimate, verified and have delivered on their actual emissions removals. I am particularly excited to witness the positive impact this product will have and its role in reinstating confidence and integrity in the voluntary carbon market."

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