Marine insurers have warned that unless the maritime sector embraces the ever increasing need to deliver a sustainable future it is in danger of shrinking.
Richard Turner, (above) President of the International Union of Marine Insurance (IUMI) told members of the organisation at its annual Spring meeting that the maritime industry faced significant challenges from the risks of climate change and the global rush towards a low carbon and sustainable future.
“Environmental, Sustainability and Governance (ESG) issues are impacting all forms of business, including marine insurance,” he explained. “We believe that our industry will be affected in three ways. Climate change and the related rise in sea levels will impact the frequency and severity of claims. The evolution of the transport assets we insure and changes to the cargoes we protect will also be significant and we are already seeing the impact as the industry adopts low sulphur fuels. And third is the sustainability of our clients and the industries in which they operate.
“It is becoming increasingly clear that some industries will have the opportunity to grow and develop while others will shrink as the world moves to a more sustainable footing. As an industry, we need to recognise these changes and adapt.”
IUMI has pledged to continue its ongoing efforts around the campaign to raise awareness of these issues to ensure the marine insurance sector is better prepared to respond adequately.
“More directly, the association is actively lobbying to raise relevant issues, monitor response and agitate for change,” it added. “Many issues already on IUMI’s policy agenda have a sustainability impact including arctic sailing and low sulphur fuels. Additionally, IUMI is coordinating responses from a wide range of stakeholders and projecting the view of marine insurance with a common voice.”
“Building on a comprehensive member survey conducted more than a year ago, we are continuing our advocacy activity on a number of key issues,” explained Mr Turner. “This has led to the formation of a sub-committee of IUMI’s executive committee to focus specifically on ESG issues. In addition, we are proud to be a supporting institution of the UN’s Principles for Sustainable Insurance.”
ESG issues will form a major part of the agenda at this year’s IUMI annual conference to be staged virtually from Seoul, Korea, in September, under the common theme “Pathways to a sustainable, resilient and innovative future”.
Richard Turner concluded: “This year’s common theme is both optimistic and forward looking, and we aim to cover the opportunities and risks that marine insurance is likely to face in a continuing and post pandemic world. We will discuss the various options and pathways that marine insurance should pursue to ensure sustainability, both in terms of ESG issues but also to maintain marine underwriting as a healthy and resilient activity.”