The government on Saturday took a decisive step to shield its seaborne trade from global disruptions with the creation of the Bharat Maritime Insurance Pool (BMI Pool). It is a Centre-backed mechanism designed to ensure uninterrupted and affordable maritime insurance coverage.
The proposal, cleared by the Union Cabinet chaired by Prime Minister Narendra Modi, comes with a sovereign guarantee of ₹12,980 crore. Announcing the decision, Information and Broadcasting Minister Ashwini Vaishnaw said the pool will support Indian trade by maintaining access to insurance even in volatile global conditions. “The current geopolitical situation made us realize that the global system of insurance and re-insurance has no coverage for such serious and problematic situations,” Vaishnaw added.
What is BMI Pool?
At its core, the BMI Pool is a domestic risk-sharing arrangement. Instead of relying heavily on foreign insurers, Indian insurance companies will collectively underwrite maritime risks using a pooled capacity of around ₹950 crore. Policies will be issued by member insurers but backed by the combined strength of the pool and the government guarantee.
According to the official release by PIB, the BMI Pool spans the full spectrum of maritime insurance. This includes:
- Physical damage to vessels
- Loss or damage to goods in transit
- Third-party liabilities like oil pollution, wreck removal, crew injury, collision liabilities
- Coverage for vessels in conflict zones
The coverage applies not only to Indian-flagged or controlled vessels but also to foreign ships carrying Indian cargo to or from Indian ports. This ensures continuity of trade even when ships pass through high-risk regions such as the Red Sea or the Persian Gulf.
Dedicated war-risk arm
To handle conflict-related claims more efficiently, a specialised arm called the Bharat Marine Pool has been operationalised by GIC Re and New India Assurance. With an initial capacity of about $100 million, the BMP is backed by a $1.5 billion sovereign guarantee, acting as a financial safety net for large-scale claims.
The move comes amid rising geopolitical instability, particularly in West Asia, which has driven up premiums and tightened underwriting norms for ships in conflict zones. India has traditionally depended on overseas insurers, especially the International Group of P&I Clubs, leaving it exposed to sanctions and market volatility.
Strategic significance
Beyond immediate risk mitigation, the BMI Pool is envisioned as a long-term platform. It will support India’s push for self-reliance by building domestic expertise in marine underwriting, claims management and maritime law. In doing so, it will strengthen the resilience of India’s trade ecosystem against an increasingly unpredictable global shipping environment.