Insuring the future of responsible marine insurance

The Poseidon Principles for Marine Insurance create a common global baseline that is consistent with and supportive of society’s goals to better enable insurers to assess and disclose their portfolio alignment.

Seven of the 10 founding members of the Poseidon Principles for Marine Insurance are members of UN Environment Programme’s Principles for Sustainable Insurance Initiative (PSI) — i.e. Gard, Hellenic Hull Management/American Hellenic Hull Insurance Company, SCOR, Swiss Re, Willis Towers Watson, the Nordic Association of Marine Insurers (Cefor), and the International Union of Marine Insurance (IUMI). Of these seven PSI members, three are also members of the PSI’s Net-Zero Insurance Alliance — i.e. Hellenic Hull Management/American Hellenic Insurance Company, SCOR, and Swiss Re. Butch Bacani of the UN Environment Programme was one of the experts consulted in the development of the Poseidon Principles for Marine Insurance.

The Poseidon Principles for Marine Insurance recognize the role insurers play in the shipping industry and promote responsible environmental stewardship throughout the maritime value chain. They set a benchmark for what it means to be a responsible insurer in the maritime sector and provide actionable guidance on how to achieve this.

“The launch of the Poseidon Principles for Marine Insurance (PPMI) is a clarion call to immediately decarbonise the shipping sector, which transports about 90% of global trade. Shipping is viewed as a sector that is difficult to decarbonise—and is not directly included in the Paris Climate Agreement—so the PPMI is an important step forward,” said Butch Bacani, who leads UN Environment Programme’s Principles for Sustainable Insurance Initiative (PSI), which hosts the Net-Zero Insurance Alliance (NZIA). “This is why we are pleased that most of the founding members of the PPMI are also members of the PSI and the NZIA. By taking action now, these insurance organisations are leading by example and serve as a compass as we navigate and accelerate the voyage to a net-zero emissions economy.”

The Poseidon Principles for Marine Insurance are consistent with the policies and ambitions of the International Maritime Organization (IMO) and they have also chosen to take steps toward alignment with the Paris Agreement.

As a result, the Poseidon Principles for Marine Insurance enable insurers to assess and disclose their portfolios with responsible environmental impacts and incentivize international shipping’s decarbonization – to support a better future for the shipping industry and society.

The Poseidon Principles for Marine Insurance is applicable to insurance providers who provide hull and machinery coverage and is supported by our insurance brokers and our business partners. They apply globally, to all shipping activities where a vessel or vessels fall under the purview of the IMO.

Principle 1: Assessment of climate alignment

Signatories will, on an annual basis, measure the carbon intensity and assess climate alignment (carbon intensity relative to established decarbonization pathways) of their hull and machinery portfolio using a robust industry-appropriate methodology established by the Poseidon Principles for Marine Insurance.

Affiliate members will support Signatories by sharing knowledge about the Assessment principle and climate alignment methodology with relevant stakeholders.

Principle 2: Accountability

For each step of the assessment, Signatories will exclusively rely on the data types, data sources and service providers identified in the Technical Guidance.

Affiliate members will, for each step of the assessment and as necessary, support Signatories by sharing knowledge about the Accountability principle and data collection process with relevant stakeholders.

Principle 3: Enforcement

Signatories will commit to making compliance with the Poseidon Principles for Marine Insurance contractual in their new business activities. Signatories agree to work with shipowners, clients, brokers, and business partners to collect and process the information necessary to calculate carbon intensity and to assess climate alignment.

Affiliate members will agree to work with Signatories, shipowners, other marine insurance providers, brokers and business partners where possible, to support Signatories by sharing knowledge about the Enforcement principle and standardized clauses with relevant stakeholders.

Principle 4: Transparency

Signatories will publicly acknowledge that they are a Signatory to the Poseidon Principles for Marine Insurance, and all Signatories’ scores will be published annually by the Secretariat of the Poseidon Principles for Marine Insurance.

Affiliate members will publicly acknowledge that they are an Affiliate Member to the Poseidon Principles for Marine Insurance and parts their self-assessment will be included into the Annual report and published on the website.