Bharat Maritime Insurance Pool (BMI Pool)

The Union Cabinet has approved the creation of a domestic insurance mechanism, the Bharat Maritime Insurance Pool (BMI Pool), backed by a sovereign guarantee of ₹12,980 crore to ensure uninterrupted maritime insurance coverage for Indian trade.

Why the Move?

• Rising global volatility and geopolitical tensions have increased risks for ships and cargo.
• Insurance premiums have surged, and availability has become uncertain, especially along sensitive sea routes.
• India currently depends heavily on the International Group of Protection and Indemnity Clubs (IGP&I Clubs) for critical liability coverage.

Key Features of BMI Pool

• Ensures affordable and continuous insurance for vessels carrying cargo to and from India, even through high-risk maritime corridors.
• Covers a wide range of maritime risks:
  • Hull and Machinery
  • Cargo Insurance
  • Protection & Indemnity (P&I) (third-party liabilities)
  • War Risk Insurance
• Policies will be issued by member insurers, leveraging a combined underwriting capacity of around ₹950 crore.

What is P&I Insurance?
P&I (Protection and Indemnity) insurance covers third-party liabilities such as:

• Oil pollution damage
• Wreck removal
• Cargo damage
• Crew injury and repatriation
• Collision liabilities

Significance

• Strategic autonomy: Reduces dependence on foreign insurance entities.
• Continuity of trade: Ensures coverage even during sanctions or geopolitical disruptions.
• Cost stability: Helps moderate rising marine insurance premiums.
• Capacity building: Promotes development of domestic expertise in:
  • Marine underwriting
  • Claims management
  • Maritime legal frameworks