Twenty three companies have pledged to the pool capacity of $100 million
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The government’s initiative to provide continuous insurance coverage to Indian flagged vessels has resulted in sizeable reduction in insurance premium, Debasish Prusty, additional secretary (Department of Financial Services) said here on Friday.The Union Cabinet, in April, approved the Bharat Maritime Insurance Pool with a sovereign guarantee of ₹12,980 crore. The pool was launched last month in the backdrop of West Asia tensions. Eighty five policies have been issued to shipping companies under the BMI pool mechanism. Prusty said hull war risk and cargo war risk premiums have for Indian companies reduced by around 27 per cent and 48 per cent respectively compared to pre-conflict levels.Typically insurance companies transfer a portion of their liability or risk to reinsurance market.“Under the BMI pool, reinsurance requirement has been replaced by the sovereign guarantee. The resulting saving in reinsurance costs would be passed on to policy holders,” said Sanjay Mokashi, General Manager, GIC Re.Twenty three companies have pledged to the pool capacity of $100 million. Reinsurer GIC Re, which is pool manager, has contributed 40 per cent to the pool. It also has substantial contribution from New India Assurance and Oriental Insurance. Currently under the BMI pool insurance companies are providing hull war and cargo war risk covers. There is a plan to offer protection and indemnity (P&I) insurance that covers third party liabilities in a phased manner. In the first stage it is proposed to offer P&I cover to coastal vessels and extend it to ocean going ships with development of expertise.Indian flagged vessels have grown from 1,210 in 2015 to 1,609 in 2026 resulting in 36 per cent growth in tonnage. “India has one per cent share of global tonnage but it is a strategic asset and requires commercially competitive and extremely dependable risk hedging, said Director General of Shipping Shyam Jagannathan.Published on June 5, 2026
