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The Department of Financial Services under the Ministry of Finance has launched India's first sovereign-backed Protection and Indemnity (P&I) insurance product under the Bharat Maritime Insurance Pool (BMIP), expanding the country's domestic maritime insurance framework. Developed by New India Assurance Company, the policy provides coverage against third-party maritime liabilities with an indemnity limit of up to USD 1.5 billion. The move builds on the successful rollout of BMIP's war risk insurance, which has reduced premium rates and strengthened domestic underwriting capacity while supporting India's efforts to reduce dependence on overseas insurance markets.
The Department of Financial Services (DFS), under the Ministry of Finance, has launched India's first sovereign-backed Protection and Indemnity (P&I) insurance product under the Bharat Maritime Insurance Pool (BMIP). The product has been developed by New India Assurance Company and is aimed at strengthening India's domestic maritime insurance ecosystem.
Financial Services Secretary Sanjay Lohia handed over the first P&I insurance policy to Shipping Corporation of India Ltd during the launch event. Senior officials from the Department of Financial Services, the Directorate General of Shipping, General Insurance Corporation of India, New India Assurance Company and Shipping Corporation of India were also present.
The newly launched insurance product offers financial protection against third-party liabilities arising from maritime operations. It covers crew and cargo liabilities, pollution-related claims, wreck removal expenses and provides access to a 24x7 port correspondent network. The policy offers an indemnity limit of up to USD 1.5 billion through the combined underwriting capacity of the Bharat Maritime Insurance Pool.
The latest addition comes after the operationalisation of the Bharat Maritime Insurance Pool earlier this year with sovereign backing to provide uninterrupted war risk insurance cover for Indian shipping stakeholders. The pool was introduced following heightened geopolitical tensions in West Asia, which had resulted in a sharp rise in global marine war risk insurance costs.
According to the Ministry of Finance, BMIP has seen strong market acceptance since becoming operational. The ministry said the pool has achieved its primary objective of ensuring continuous availability of war risk insurance capacity for Indian shipowners, cargo operators and other maritime stakeholders.
The ministry also stated that the introduction of BMIP has reduced war risk insurance premiums by around 35-40 per cent compared with the peak levels witnessed during the West Asia conflict. The lower premiums have helped reduce insurance costs for Indian shipping companies engaged in international trade.
As of earlier this month, the pool had issued 1,608 policies covering both Cargo War Risk and Hull War Risk insurance, reflecting increasing adoption of the domestic insurance mechanism by the maritime sector.
The government believes that expanding BMIP to include Protection and Indemnity coverage will further strengthen India's maritime risk management framework. It said the addition of P&I insurance will improve the resilience of the country's maritime insurance ecosystem while encouraging the development of specialised underwriting expertise within India.
The ministry further said the initiative aligns with the government's broader objective of building strong domestic insurance capabilities under the Atmanirbhar Bharat vision. It aims to reduce dependence on foreign insurance providers for specialised maritime risks and ensure that a greater share of insurance value generated through India's growing maritime trade remains within the domestic economy.
Source PTI
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