Swiss RE, one of the world's largest reinsurers, signed in August the first long-term contract in which a company buys carbon capture from the atmosphere. Under the agreement, Swiss Re will deliver US$10 million over the next ten years to Climeworks (https://climeworks.com/), a startup that is commissioning the largest CO2 capture plant built to date in Iceland this month. The plant, called Orca, will capture 4,000 tons of CO2 per year using geothermal energy. This CO2 will be mixed with water and injected underground where it will solidify.

The development of cost-effective technologies for capturing CO2 from the atmosphere is in the early stages. In announcing the agreement, Swiss Re said it seeks to send a signal to project developers, as well as investors and other potential buyers of CO2 capture.

The insurance industry is highly exposed financially to the effects of global warming and climate change. According to Swiss Re's mid-year report, insurance-related losses totaled US$40 billion in the first half of the year, the second highest figure on record for a six-month period, partly due to climate change-related events.

Climeworks launched its first carbon capture plant in Switzerland in 2017, where the captured CO2 is sold for use in the manufacture of fertilizers, soft drinks and synthetic fuels.