CFC’s CORSIA Guarantee Insurance (CGI) has been approved by Gold Standard.
International aviation equates to 2.5% of global CO₂ emissions annually, with a single passenger flight generating about a quarter of a tonne of CO₂ equivalent per hour.
To tackle this, the International Civil Aviation Organization (ICAO) developed the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) – the first global market-based mechanism designed to address carbon emissions from international flights and bring the sector in line with carbon-neutral growth from 2020 onwards.
Under CORSIA, airlines are required to offset any increase in CO₂ emissions by financing emission-reduction projects to compensate for those emissions.
What is CORSIA Eligibility?
To sell credits into the CORISA market, project developers must meet strict integrity and regulatory standards. Eligible Emissions Units (EEUs) are considered CORSIA-eligible if they meet the following criteria:
- Eligible registry: Credits must be issued under one of ICAO’s approved registries, including ACR, ART TREES, CAR, Gold Standard, Isometric and Verra.
- Eligible methodology: Methodologies are embedded within registry requirements but commonly include cookstoves, energy efficiency, and forestry and land use projects (ARR or IFM).
- Host country authorization: Units must be formally authorized by the host country for use in CORSIA with a Letter of Authorization (LOA) stating that the unit is for other international mitigation purposes.
- Safeguards against double counting: Developers must ensure credits are not double claimed. This can be achieved through:
- Evidence from UNFCCC reporting – for example, a copy of the host country’s Biennial Transparency Report (BTR), national registry record, or UNFCCC Article 6 database showing that a corresponding adjustment has been applied; or
- Insurance guarantee – purchasing CORSIA Guarantee Insurance which means CFC will step in to replacement affected EEUs if a corresponding adjustment fails or the a host country authorization is revoked.
Additionally, developers must sign a deed of undertaking for each EEU issuance, committing to replacing any EEUs later found to be double claimed. Breaches can trigger credit replacement, financial penalties or indemnification.
CORSIA Guarantee Insurance
How does it work?
Operating within CORSIA’s complex regulatory and political landscape can be challenging. The CORSIA Guarantee simplifies this process by providing a transparent, compliant insurance solution that safeguards against the financial losses associated with a corresponding adjustment failure event.
In the event of a covered loss, CFC steps in to replace EEUs to ensure the continuity of CORSIA scheme’s integrity.
Who is it for?
Carbon project developers generating credits under Gold Standard or other approved standards who wish to have their credits recognised as CORSIA-eligible.
What does it cover?
The policy provides targeted protection against key risks that can undermine the validity of CORSIA-labelled credits:
- Revocation of authorization by the host country
- Failure of the corresponding adjustment due to host country action
- Revocation of a corresponding adjustment post technical review
If an insured credit is affected by either of these events, CFC will cover the costs associated with procuring an EEU replacement, up to the insured limit. Developers can select their coverage limit to match the project’s exposure and the value of replacement credits.
Benefits?
CORSIA represents a major opportunity for carbon project developers to participate in a regulated, high-integrity global market. With CFC’s CORSIA Guarantee, developers can access new value streams while ensuring compliance with ICAO’s technical and procedural requirements.
How we underwrite – fast, data-driven and transparent
Our underwriting analysis considers three core areas:
- The underlying carbon project
- Letter of Authorization received by the carbon project
- Host country readiness
We use a tech-enabled and data-driven underwriting process which allows us to offer insurance indications within a matter of days.
Complete our short online web-form to get in contact with the team.
Key policy terms
- Policy term: Up to 7 years
- Limit: Up to USD 20 million per project
- Exclusions: War and nuclear events only
Get started
CFC’s CORSIA Guarantee Insurance helps project developers unlock liquidity and integrity in the international carbon market – instilling the confidence to trade CORSIA-eligible credits globally.
Learn more by contacting our team, or use our online application form to get a quote in under 24 hours.
