Major marine insurer Swiss Re said it is progressing toward monitoring the emissions performance of its clients.
The initiative comes part of discussions to establish a format for the marine insurance industry to encourage decarbonisation, similar to the Poseidon Principles for the banking industry and Sea Cargo Charter established by charterers.
The move was revealed by Swiss Re head of marine Patrizia Kern at the Shipping Risks Forum held during London International Shipping Week.
“It is important we as an industry are proactive, we don’t want to be seen as the ones that are always behind,” she said.
Talk of a possible Poseidon Principles for the marine insurance industry was first announced at the International Union of Marine Insurance conference earlier this month.
Signatories of the Poseidon Principles monitor the emissions performance of clients in line with the International Maritime Organization's emissions reduction targets.
Kern said Swiss Re has already run through possible emissions calculations which could be applied in the context of marine insurance.
Kern is keen to start communicating with shipowners over emissions performance.
“It is about creating a constructive dialogue with clients,” she said.
Leading hull and protection and indemnity insurer Gard is also considering joining the insurance initiative, which is likely to form part of the Global Maritime Forum, under which the Poseidon Principles and Sea Cargo Charter also both operate.
Gard has not yet decided whether it will commit. However, chief underwriting officer Magne Nilsen said: “We are in a position to influence people.”
Poseidon Principles chair Michael Parker said the shipping industry is already well on the way to full transparency on emissions.
He said that under the Poseidon Principles, banks are asking clients for emissions data that they are already required to provide under the International Maritime Organization's emissions monitoring scheme.
“We have not asked for anything they did not already have to provide legally,” he said.
He said that shippers are already demanding full transparency on emission’s performance. “Cargo owners will drive the market,” he said.
Some questions were raised over whether it would be possible for insurers to follow the banking industry. International Group of P&I Clubs chief executive Nick Shaw, who moderated the discussion, questioned where ships which fell short of the emissions criteria would find cover.
The question of whether insurers can play a role in encouraging the use of alternative fuels is also a thorny issue.
Swiss Re’s Kern admitted she is not allowed to provide cover prototype vessels, but is looking for ways it can participate in covering ships adopting new technology and fuels.