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The Department of Financial Services (DFS) launched India's first sovereign-backed Protection & Indemnity (P&I) insurance product under the Bharat Maritime Insurance Pool (BMIP), designed by New India Assurance, offering an indemnity limit of up to US$1.5 billion for third-party liabilities (crew/cargo, pollution, wreck removal).
BMIP has operated since 12 May 2026 under a ₹12,980 crore sovereign guarantee; war-risk premium rates have fallen 35-40% from their West Asia-conflict peak, and 1,608 Cargo/Hull War Risk policies had been issued as on 29 July 2026.
The initiative supports Atmanirbhar Bharat by building domestic underwriting capacity and reducing dependence on foreign maritime insurance markets.
India's national reinsurer, part of the combined underwriting capacity backing BMIP
Designed and issues the new P&I insurance product under BMIP
Operationalised and administers BMIP under the Ministry of Finance
BMIP was first launched for WAR RISK insurance (covering cargo/hull losses from conflict, e.g. attacks in the Red Sea/Strait of Hormuz) and has now been EXTENDED to Protection & Indemnity (P&I) insurance, which covers third-party liability risks (crew injury, cargo damage claims, pollution, wreck removal) — a different, broader category of maritime risk that shipowners traditionally source from international P&I Clubs.
Simple Analogy: War risk cover protects the ship and cargo itself from conflict; P&I cover protects the shipowner from claims OTHERS might bring against them because of the ship's operations
War risk premiums spiked as conflict escalated in the region; BMIP was created precisely to keep insurance capacity available to Indian shippers when international markets became expensive/unreliable
GS Paper 3 > Economy > Insurance, Maritime Trade
Moderate-high — a novel, topical institution tied to ongoing geopolitical shipping risk
Protection & Indemnity insurance — covers a shipowner's third-party liabilities (crew, cargo, pollution, wreck removal)
Bharat Maritime Insurance Pool — India's sovereign-backed maritime insurance pool, operational since 12 May 2026