New Delhi, April 18
The Union Cabinet on Saturday approved the creation of a domestic insurance mechanism, Bharat Maritime Insurance Pool, with a sovereign guarantee of Rs 12,980 crore to ensure continuous maritime insurance coverage for Indian trade.
According to an official statement, the initiative aims to address global volatility and geopolitical instability while reducing dependence on foreign insurers for maritime risk coverage. The pool will cover a wide range of risks, including hull and machinery, cargo, protection and indemnity, and war-related risks.
“The pool covers all maritime risks like Hull and Machinery, Cargo, P and I and War risk. It covers vessels carrying cargo from any international origin to Indian ports and vice versa, even when transiting volatile maritime corridors,” the statement said.
The coverage will apply to vessels operating between international locations and Indian ports, including routes passing through high-risk maritime regions. The government said the move will help ensure continued access to affordable insurance for Indian trade despite global disruptions.
Officials noted that rising geopolitical tensions have increased the risks to cargo and vessels, leading to higher insurance costs and uncertainty about coverage availability. At present, Indian vessels rely significantly on international protection and indemnity clubs for third-party liability insurance covering oil pollution, cargo damage, crew safety and collision-related liabilities.
The government said there is a need for a domestic maritime insurance pool to maintain trade continuity in situations where global coverage may be withdrawn due to sanctions or geopolitical developments. The Bharat Maritime Insurance Pool will cover Indian-flagged or controlled vessels, as well as those operating to or from Indian ports.
Policies will be issued by member insurers using a combined underwriting capacity of around Rs 950 crore. The initiative is also expected to build domestic capacity in marine underwriting, claims management and legal expertise in line with Indian regulatory requirements.
A governing body will be constituted to oversee the formation and functioning of the pool. The sovereign guarantee is intended to strengthen self-reliance, improve resilience against external disruptions and ensure greater national control over maritime insurance needs.
The move is expected to support India’s shipping sector by providing stability in insurance availability and reducing vulnerability to global uncertainties affecting maritime trade.
