India Ends Foreign P&I Reliance with $1.5 Billion Sovereign-Backed Maritime Pool
The Ministry of Finance has introduced a domestic Protection and Indemnity insurance product under the Bharat Maritime Insurance Pool. Designed by New India Assurance, the sovereign-backed fund offers $1.5 billion in coverage to insulate Indian shipping from global market volatility.
Key takeaways
- India launched its first domestic Protection and Indemnity insurance product under Bharat Maritime Insurance Pool on July 30, 2026.
- The new sovereign-backed P&I product provides up to $1.5 billion in indemnity coverage for third-party maritime liabilities.
- Since its May 2026 debut, the insurance pool has reduced war risk premium rates by 35% to 40% for Indian stakeholders.
- As of July 20, 2026, the pool has successfully issued 1,608 policies for cargo and hull war risks.
Strategic Autonomy in Maritime Risk Management
The Department of Financial Services (DFS) officially expanded the Bharat Maritime Insurance Pool (BMIP) on July 30, 2026, by introducing a domestic Protection and Indemnity (P&I) insurance product. During a ceremony in New Delhi, Financial Services Secretary Sanjay Lohia delivered the inaugural policy document to Binesh Kumar Tyagi, Chairman and Managing Director of the Shipping Corporation of India Ltd. This sovereign-backed initiative, engineered by the New India Assurance Company, represents a structural shift toward self-reliance in specialized marine insurance.
Fiscal Impact and Coverage Expansion
Since the DFS operationalized the BMIP on May 12, 2026, the pool has significantly altered the cost landscape for domestic shippers. Following the peak of the West Asia conflict, war risk premium rates dropped by roughly 35% to 40% due to the pool's stabilizing influence. As of July 20, 2026, the mechanism had already issued 1,608 policies covering hull and cargo war risks. The new P&I extension broadens this scope, offering indemnity limits reaching $1.5 billion through the internal capacity of the pool.
Technical Provisions and Stakeholder Support
The upgraded P&I product provides comprehensive financial safeguards against diverse third-party liabilities, including:
- Pollution liability and environmental damage costs.
- Total wreck removal operations.
- Crew and cargo-related legal liabilities.
- Access to a 24/7 port correspondent network for real-time support.
The launch event included high-level representation from the Indian maritime and insurance sectors. Notable attendees included Director General of Shipping Shyam Jagannathan, GIC Re CMD Hitesh Joshi, and New India Assurance CMD Girija Subramanian. By retaining the value generated from trade within the domestic economy, the Ministry of Finance aims to reduce long-standing dependence on international underwriting markets, aligning with the Atmanirbhar Bharat framework.
Source: The Hindu — Economy
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