In March 2025, the Poseidon Principles for Marine Insurance released its third annual disclosure report, showcasing contributions from nine signatories and nine affiliate members across ten countries and reinforcing its leadership in supporting global shipping decarbonization. Launched in 2021, the framework was spearheaded by insurance institutions including Swiss Re Corporate Solutions, Gard, and Cefor, in collaboration with industry leaders such as WTW, Star Bulk, and A.P. Moller - Maersk, with expert support from the Global Maritime Forum and UMAS.
As the latest ground-breaking transparency initiatives backed by the Global Maritime Forum—following the Poseidon Principles for Financial Institutions and the Sea Cargo Charter—the Poseidon Principles for Marine Insurance drives international shipping decarbonization by assessing and disclosing the climate alignment of hull and machinery (H&M) insurance portfolios. To date, signatories and affiliate members represent over 25% of the world fleet’s deadweight, fostering industry-wide collaboration among relevant stakeholders.
The latest report marks a major upgrade to the reporting methodology. Aligned with the revised 2023 IMO GHG Strategy, it introduces a well-to-wake emissions calculation framework for the first time, incorporating additional types of GHG besides carbon dioxide, such as methane and nitrous oxide. A ground-breaking addition is the Modelled Data Pathway Track, which enables signatories to rapidly generate climate alignment scores via a third-party data platform—without relying on IMO DCS data from clients—significantly enhancing the comprehensiveness and efficiency of emissions reporting.
On the occasion of the report’s release, Ms. Patrizia Kern-Ferretti, Chair of the Poseidon Principles for Marine Insurance, engaged in an in-depth interview with China Ship Survey. She examined the rationale behind the framework’s evolution, analyzed the impact of methodological updates on climate alignment deviations from IMO targets, and offered expert recommendations for accelerating decarbonization, enhancing emission transparency, and strengthening industry collaboration. She also shared the Poseidon Principles for Marine Insurance’s plans to expand its membership network and refine its operational framework.
Q：The third annual disclosure report from the Poseidon Principles for Marine Insurance highlights the introduction of the Modelled Data Pathway Track in 2024. Could you please elaborate on how this information flow pathway works? What specific changes has this new approach brought to signatories’ climate alignment calculations and reporting processes? How do you balance data flexibility with accuracy when using third-party modelled data?
A：The Modelled Data Pathway Track enables the calculation of climate alignment using modelled data from a third-party provider.
It uses estimations of vessel information to produce climate alignment scores. This differs from the processes used in the last two years, which involved signatories asking for data from their clients, which is the same data clients submit to comply with the IMO Data Collection System (IMO DCS) regulation. However, since one signatory can have thousands of vessels in their hull and machinery portfolio, collecting this immense quantity of data was challenging.
Modelled data enables an expanded reporting scope, where all signatories, regardless of their leading or following status, can calculate climate alignment of their entire hull and machinery portfolio, and not only vessels where a fellow signatory is claims lead. It also makes gathering data and calculating climate alignment incredibly efficient, being done in minutes, and reduces administrative burden on both signatories and their clients.
The three different information flow pathways provide increased reporting flexibility by allowing signatories who prefer to gather data directly from clients or through recognised organisations to do so while accommodating those who would like to rely exclusively on modelled data.
Please see Figure 5 on page 16 of the report and below showing an overview of the three information flow tracks and how each step can be completed.
When the climate alignment scores are considered with the qualitative context given by signatories’, this provides useful insights into how the new methodology can continue to support decarbonisation of the industry by providing a more accurate picture of emissions, due to the increased ambitions set by the IMO, the expanded reporting scope, and the simplified reporting process.
Due to the substantial updates, greater understanding and experience using the new methodology is needed before conclusions can be drawn. However, tracking emissions in general is becoming standard practice and can be used to support internal sustainability practices.
Q: The 2023 climate alignment scores reveal that the global fleet’s overall emissions are currently misaligned with IMO targets, averaging a +20.8% deviation from the minimum trajectory. Beyond methodological updates, what additional factors contributed to this misalignment?
A: Different factors can influence a score. A vessel's climate alignment score is calculated based on distance travelled, the amount of fuel consumption for each fuel type, hours underway, and technical characteristics of ships. Real-world impacts on these variables can then be reflected in the score.
The Poseidon Principles for Marine Insurance establish a framework for the assessment of climate alignment and disclosure of H&M portfolios. It does not provide solutions for how to achieve climate alignment. It is the responsibility of signatories to determine how they choose to improve their portfolio performance.
Broadly speaking, however, to improve a portfolio’s score, it is necessary to reduce the emission intensity of the vessels that underlie the portfolio relative to their respective decarbonisation trajectories. Signatories can engage with clients to identify and support ways to bring down carbon intensity, or towards technologies that are climate-aligned (e.g., lower- or zero carbon fuels).
Fleet composition emerged as a primary driver of the overall climate alignment scores reported. Signatories insuring segments with higher emissions potential can face challenges in improving their scores, whereas those focused on cleaner technologies or more efficient vessel types can report better results. As was the case last year, a small number of vessels can disproportionally impact the overall climate alignment score of an entire portfolio.
These results mirror the current stand of the shipping industry which still to increase efforts towards net-zero emissions by 2050 as set by the IMO. The maritime industry is still at the beginning of its decarbonisation journey, and it will take time for the industry and marine insurers’ efforts to be reflected in marine insurers’ portfolios.
The maritime sector is currently undergoing a period of significant change, from the development of new technologies, vessels, and fuels to navigating the changing landscape of regulation, policies, trade patterns, and geopolitics.
Signatories are only starting to amass emissions data and insight into how different trends affect climate alignment. However, collecting and reporting this data year over year will allow them to incentivise shipping decarbonisation by providing valuable insights to support risk mitigation, as well as improve their dialogue with their clients, based on data.
This is a further reason to continue to show support for IMO climate ambitions through disclosure of climate alignment.
While the path to decarbonisation remains challenging, the Poseidon Principles for Marine Insurance provide a valuable framework to track progress, refine underwriting strategies, and support the transition to lower-emission shipping.
A clearer year-on-year comparison will only be possible in future reporting cycles when signatories can measure progress against the same benchmark, and continued use and refinement of the methodology will eventually be able to provide important insights for signatories and affiliate members.
Q: In your view, what areas require intensified investment or action by industry stakeholders to accelerate shipping decarbonization?
A: The marine insurance industry plays a unique role in facilitating decarbonisation across the global shipping sector.
This is especially important considering the significant coverage gaps which currently exist in the liability and regulatory frameworks associated with the various new technologies and fuels needed for the net-zero transition.
With a clear imperative to decarbonise, understanding the intricacies of the industry's emissions through transparent climate reporting is important for stakeholders across the shipping industry, including marine insurers, brokers, captives, and P&I clubs.
The Poseidon Principles for Marine Insurance offers organisations in this sector an opportunity to play a leadership role in aligning their activities with the shipping industry's global priorities while supporting their client in doing the same.
While the global shipping fleet's overall emissions are currently not aligned with the IMO decarbonisation trajectories, both signatories and affiliate members remain dedicated to supporting the shipping industry in achieving its emissions reduction targets.
In addition to reporting that an increased number of their vessels run on, or are ready to run on, alternative fuels, signatories also noted a continued commitment to collaborating with clients and other stakeholders who are developing new technologies, making sure operations are efficient, and using alternative fuel types.
Achieving net-zero emissions will require industrywide collaboration and continued transparency initiatives.
Q: How does the Poseidon Principles for Marine Insurance framework assist insurers and shipowners in balancing decarbonization goals with commercial viability, particularly in complex operational environments?
A: The Poseidon Principles for Marine Insurance foster decarbonisation by:
Supporting the overall direction set by the IMO, including industry decarbonisation targets.
Serving as a reporting framework developed by the industry in collaboration with the Global Maritime Forum and supported by expert advisories.
Enhancing transparency and collaboration between industry leaders and promote responsible business practices.
Helping track progress over time through the annual calculation and reporting of climate alignment in relation to IMO climate ambitions.
Providing data-driven risk management and mitigation: Understanding and mitigating climate-related and decarbonisation risks, like insuring new technologies, alternative fuels, and retrofitted vessels, is essential for the industry to meet IMO goals. Access to comprehensive climate alignment data allows for better risk assessment and helps guide climate-friendly practices.
Assisting in meeting regulatory compliance: The updated methodology is aligned with the ambitions set by the IMO and can help proactively meet and understand the increasing pressure from regulatory compliance and expectations.
Strengthening the future resilience of global trade: Supporting clients’ decarbonisation and efficiency activities helps to ensure the systemic stability and reliability of the international shipping industry in an increasingly complex global landscape.
Q: Current signatories represent more than 25% of the total deadweight of the global shipping fleet. What strategies will Poseidon Principles for Marine Insurance implement to attract more signatories and affiliate members in the future?
A: Nine signatories currently reporting represent this 25%. Another signatory was not able to report this year.
Along with signatories, 10 affiliate members are actively involved. They can be insurance brokers and collective groups such as insurance associations, unions, captives, and protection and indemnity (P&I) clubs. The ecosystem of marine insurance extends beyond the current scope for signatories, so the framework includes various perspectives and support.
The Poseidon Principles for Marine Insurance currently has 19 members covering 10 countries in total. It is the intention that over time, and with increasing access to reliable data, the scope of the Principles will expand to include more affiliate members as signatories.
The aim is to expand the membership in terms of signatories and affiliate members and geographies; through connections from current members, events to showcase the initiative, etc. Joining a group of peers to share best practices and benefit from the Global Maritime Forum expertise is a key lever.
Both signatories and affiliate members highlight a variety of ways they have supported this necessary collaboration, including facilitating discussions with prospective members, embedding the Principles into internal sustainability strategies, hosting and supporting discussions, workshops, and forums about best practices, and assisting clients in meeting evolving regulatory compliance.
Affiliate members especially play an important role in bridging the gap between marine insurers and shipowners and can advocate for increased transparency.
Q: The report emphasizes the importance of enhancing emission transparency and industry collaboration. What concrete steps will Poseidon Principles for Marine Insurance take to further facilitate transparency and collaboration in practice? Could you share recommendations to address current challenges in these areas?
A: There is an ongoing need for enhanced transparency on shipping emissions overall, which could be achieved, om top of modelled data use, by increasing access to IMO DCS data, and the development of strong international policy measures to support the transition.
The new methodology and trajectories, along with the broader access to data, are expected to enhance transparency within the initiative as a whole by expanding the scope of the reported emissions.
In conjunction with the increased level of ambition, the Poseidon Principles for Marine Insurance will continue driving industry-wide progress and help the industry meet IMO decarbonisation goals.
As shared during MEPC81 in March 2024, and to support the IMO, the Poseidon Principles for Marine Insurance call for:
enhancing transparency on shipping emissions, for instance by opening the IMO DCS to ease access to data;
strong international policy measures in place to support the industry in transitioning and reaching the ambitions set.
Q: What are Poseidon Principles for Marine Insurance’s key priorities moving forward? Are there plans to expand the initiative’s scope to cover other types of marine insurance? How will you further refine the methodology and framework to strengthen its relevance and impact?
A: The methodological changes show the Association is committed to the ongoing development of a methodology tailored for marine insurers’ needs, with the overall ambition to support their clients in decarbonisation efforts.
While this year ahead will focus on implementation and learnings, continued use and refinement of the methodology will provide insights for signatories and affiliate members. There are some future challenges to consider when using modelled data, including the increasing use of new fuels for example.
Another focus is on expanding membership and overall coverage of reporting, and the use of modelled data could allow for organisations that are unable to access IMO DCS data from clients to meet the reporting requirements.
Climate alignment is currently the only environmental factor considered by the Principles. This scope will be reviewed and may be expanded by signatories and affiliate members on a timeline at their discretion.
Looking ahead, the focus of the coming years is on expanding membership in the Poseidon Principles for Marine Insurance to ensure the continued robustness of the initiative both in terms of geographies and entities.