MUMBAI: Public sector insurers led by GIC Re and New India Assurance have anchored the Bharat Maritime Insurance Pool with commitments exceeding the targeted $100 million, while a $1.5 billion sovereign backstop from the govt remains central to its capacity to underwrite large risks.
The pool aims to enable sea trade with countries in the Persian Gulf in the wake of global underwriters withdrawing cover following the outbreak of hostilities.The pool has 20 contributors, including three reinsurance companies, while health insurers have been excluded as they do not underwrite marine risks. GIC Re is the largest contributor at around Rs 200 crore, followed by New India Assurance at Rs 100 crore.
Oriental Insurance and United India Insurance have contributed about Rs 75 crore each, while Tata AIG General Insurance has committed around Rs 69 crore. Other insurers have added smaller amounts.Kasturi Sengupta, secretary general of General Insurance Council, said that the sovereign guarantee of $1.5 billion is a key enabler for the pool because there is no other capacity available globally. She said that the pool would make cover available for not just Iran but other strife-torn regions.
Policies will be issued by participating insurers, and claims will be met by pool members in proportion to their contributions.
Coverage will be restricted to Indian-flagged or Indian-controlled vessels carrying cargo to or from international ports. The cover will extend to the vessel, cargo, and third party liability under protection and indemnity.The initiative follows the withdrawal of marine reinsurance cover by global reinsurers after the conflict in West Asia. Insurance is required because if a ship is damaged, causes pollution, or loses cargo, the insurer pays, and without such cover ships often cannot enter ports or operate. Reinsurance is needed because Indian insurers lack the balance sheets to absorb the loss of a single large crude carrier.
