The Insurance Implications of IMO Greenhouse Gas Initiatives

The significance of insurance in the maritime industry cannot be overstated, as evidenced by the payment of over GBP 30 billion in premiums by maritime operators in 2022. These premiums cover various risk categories such as hull, cargo, accidents, and pollution. Marine insurance policies require shipowners to act with due diligence, akin to being a ‘prudent uninsured’, and to adhere to international conventions governing their operations, ensuring the seaworthiness of their ships. Failure to meet the standards outlined by the International Maritime Organization (IMO) and other governing bodies pose tangible risks for insurers due to increased hazard exposures and potential claims. This chapter delves into the recent initiatives by the IMO to reduce greenhouse gas emissions, exploring the challenges faced by shipowners in ensuring green seaworthiness. Additionally, it examines the potential marine insurance implications associated with non-conformity, both for shipowners and their insurers.