How Bharat Maritime Insurance Pool is helping shipping sector tide over war-risk

New Delhi, Sep 27 (IANS) The launch of Bharat Maritime Insurance Pool (BMIP) in May 2026 marks a significant milestone in India’s maritime insurance sector. Since its operational launch, the BMIP has ensured uninterrupted war-risk insurance for Indian maritime stakeholders. 

War-risk insurance premiums have fallen by about 35–40 per cent since the peak of the West Asia conflict. As on September 7, 2026, the Pool has issued 3000 Cargo War, 92 Hull War-risk and 3 Protection & Indemnity insurance policies, according to a factsheet issued by the government on Sunday.

Conflicts in the Red Sea and tensions near the Strait of Hormuz have disrupted vital routes. With a major share of crude oil imported by sea, India’s energy security depends on uninterrupted coverage. During this period, foreign insurers increased insurance premiums or stopped providing cover. This increased costs sharply for ship owners, raising the need for a domestic safety net.

The insurance facility has been set with government-backed support of Rs 12,980 crore ($1.4 billion) which ensures financial strength. This guarantee meets obligations even during catastrophic losses. The Pool can ensure risks worth Rs Rs.13,906.5 crore ($1.5 billion), backed up by the Sovereign Guarantee, increasing its ability to cover large maritime losses, the factsheet states.

Earlier, India did not have institutional depth in marine underwriting and claims management. BMIP builds this expertise indigenously, laying the foundation for a domestic insurance sector and reducing reliance on foreign hubs like London or Switzerland.

BMIP has been designed to provide comprehensive coverage across the full spectrum of maritime risk categories. It ensures that no vessel or cargo involved in Indian trade is left without domestic insurance protection, regardless of the route or nature of the risk.

On 30 July, 2026, India’s first Protection & Indemnity insurance policy under BMIP was issued to Shipping Corporation of India Limited. Issued by New India Assurance Company Limited, it provides financial protection against third-party liabilities.

A Marine Cargo War Policy was also issued to Vedanta Sterlite Copper Limited. It protects the company's import of cable wires into India. This shows the pool can serve India's large industrial importers. It keeps the supply chains feeding Indian industry safely insured.

Besides, a policy was issued to Balrampur Chini Mills Limited, a sugar manufacturer. This proves the pool is not for shipowners alone. Farms, factories, and commodity traders moving goods by sea can all seek cover. The pool, therefore, works for the wider Indian economy.

The Governing Body and Underwriting Committee have been set up since the launch. General Insurance Corporation of India (GIC Re) has taken charge as the Pool Manager/Administrator. Systems for underwriting, claims, and regulatory compliance are also put in place. The pool is operating at full commercial scale.

 India had been dependent on foreign insurers for the insurance value chain. Indian shipowners rely almost entirely on 13 international P&I clubs, mostly based in the West. This dependence leaves India vulnerable to sudden coverage withdrawal or politically influenced decisions, underscoring the importance of a homegrown alternative, the factsheet added.

--IANS

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