Kita, a specialist insurer focused on carbon and natural capital markets, has launched a new Non-Payment Insurance product aimed at reducing financing risks and unlocking institutional capital for climate and nature-based projects.
The London-based Lloyd’s of London coverholder said the policy is designed to protect lenders and investors from the risk that counterparties fail to meet payment obligations tied to carbon and natural capital projects.
Lead underwriting capacity for the product is being provided by MS Amlin, a Lloyd’s specialty insurer with a long-standing presence in credit and political risk, with additional backing from Chaucer Group and Tokio Marine Kiln.
The insurance is structured to cover a range of credit exposures, including project finance, prepayment facilities and offtake receivables.
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By transferring counterparty credit risk to A-rated insurance balance sheets, the policy is intended to reduce loss given default (LGD) for lenders, support regulatory capital relief and potentially lower financing costs for project developers.
The product is aimed at addressing one of the most persistent barriers in climate finance: the difficulty of securing bankable structures for early-stage or emerging-market projects.
Insurance coverage can replace or complement traditional guarantees, shortening deal timelines and enabling developers to access debt on more favorable terms.
According to MS Amlin, the policy reflects the growing role insurers can play in climate finance.
“The transition to a low carbon economy depends on the ability to finance credible projects and grow them at scale – yet many stall due to counterparty credit risk,” said Louise Scott, Political Risk Underwriter at MS Amlin.
Kita said the offering builds on its recent expansion across carbon insurance markets, including a sharp increase in underwriting capacity and the extension of coverage to additional project types such as soil organic carbon.
The company has also expanded its Non-Delivery Insurance to address both supply- and demand-side risks.
“Financing the transition needs more than good intentions – it needs bankable risk transfer,” said James Kench, managing director of insurance at Kita.
The Non-Payment Insurance product is available immediately through specialist credit and political risk brokers and directly via Kita for qualified counterparties.
Read more: Kita Expands Carbon Insurance Capacity To $29.1M Amid Rising Market Demand
