Support for shipping’s decarbonization goals grows among marine insurers

The Poseidon Principles for Marine Insurance has released its third annual disclosure report, showing growing support for the International Maritime Organization’s (IMO) decarbonization goals.

As a framework supporting insurers, brokers, and other industry players in aligning their activities with global shipping decarbonization efforts, the principles entered into force in 2022.

They contribute to the marine insurance sector’s broader engagement with sustainability and risk considerations, in line with the IMO 2050 net-zero emissions ambition.

This year’s report includes contributions from nine signatories and nine affiliate members across ten different countries.

“Marine insurers play a crucial role in supporting the IMO’s global shipping industry’s transition to net zero,” Patrizia Kern-Ferretti, Poseidon Principles for Marine Insurance chair, commented.

“Through data-driven insights and insurers’ expertise, we are helping shipowners navigate the path toward a more sustainable future while reinforcing the industry’s commitment to responsible underwriting.”

This year, nine signatories, representing over 25% of the total deadweight of the world fleet within the reporting scope, calculated climate alignment scores using vessel data from 2023.

The results highlight:

1/ Against the 2023 IMO GHG Strategy – minimum trajectory, alignment scores ranged from -10.4% to +28%, with a weighted average of +24.8% and a simple average of +20.8%.

2/ Against the 2023 IMO GHG Strategy – striving trajectory, scores ranged from -6.1% to +34%, with a weighted average of +30.8% and a simple average of +26.7%.

This means that, on average, climate alignment scores were +20.8% misaligned with the IMO’s minimum ambition in 2023.

Since June 2024, climate alignment scores have been produced using estimations based on a modeled data pathway track. This approach enhances reporting by gathering climate data across the entire H&M portfolio, improving efficiency and reducing the administrative burden on both signatories and their clients.

While the IMO does not require marine insurers to report on the climate impact of their portfolios, the insurance sector is said to play a crucial role in decarbonization. Insurers help shipowners adapt to new environmental regulations by providing data-driven insights that support sustainable shipping practices.

Additionally, they assist clients in meeting compliance requirements and reducing their carbon footprint. These efforts not only benefit shipowners but also help insurers align with key regulatory frameworks, such as the European Union’s Corporate Sustainability Reporting Directive.

As the industry gains greater experience with these methodological improvements, future reports will provide deeper insights into emissions trends and their implications. Tracking emissions is becoming a standard practice in marine insurance, bolstering internal sustainability practices and contributing to the reduction of global shipping emissions.

“This year’s annual report highlights the marine insurance industry’s commitment to supporting the IMO’s decarbonisation goals,” Sundeep Khera, Poseidon Principles for Marine Insurance vice chair, pointed out.

“By setting higher standards and integrating comprehensive emissions data, insurers are actively contributing to a more sustainable shipping sector.”

Signatories highlight that incorporating the latest IMO ambition provides a more accurate emissions baseline, while updated data pathways enhance reporting efficiency and coverage. They also reaffirm that there is a strong commitment to supporting decarbonization through client engagement.

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