Ping An Property & Casualty Insurance Co. of China Ltd. on Tuesday launched a marine carbon sink policy in Dalian, China.
The policy pays out when specific changes in the marine environment harm local species and lead to a weakening of the carbon sink.
The policy provides RMB 400,000 ($58,681) coverage over 8,866.67 square meters of kelp, shellfish and algae, Ping An said.
Payments can be used for marine species rescue after a disaster to restore the carbon sink resource and for ecological protection and restoration.
“Index insurance improves ocean carbon sequestration capacity by encouraging fishing to protect and repair marine ecosystems. It also enables marine aquaculture carbon sink indicators to be listed and traded,”; Ping An said in a statement.
The ocean is the Earth’s largest carbon sink and can absorb about 2 billion tons of carbon dioxide a year from the atmosphere, Ping An said. Marine disasters such as typhoons, abnormal ocean temperatures, and algal blooms can compromise the ocean’s carbon sequestration capacity and impede progress toward carbon neutrality.
By November 2022, Ping An P&C had provided over $25.53 trillion in green insurance coverage to promote green development, according to the statement.