Debasish Prusty, additional secretary, Department of Financial Services
The re/insurers should explore the future roadmap in three steps: achieving sovereignty in maritime trade through development of a P&I product domestically, scaling up of BMI pool covers to selective ocean-going vessels in collaboration with Ministry of Ports, Shipping and Waterways(MoPSW) and exploring potential integration with International Group P&I Clubs (IG) Clubs through mutual club formation, compatible with international regulations and standards, said Debasish Prusty, additional secretary, Department of Financial Services .
Mumbai:With formation of a $1.5 billion Bharat Maritime Insurance Pool (BMIP),there has been a 27-48% reduction in premium charged for policies of Hull war and Cargo war risk covers respectively in the country amidst prolonged West Asia crisis.
This was highlighted at a workshop organised by the General Insurance Council and Shipping Corporation of India on Friday in Mumbai and was inaugurated by Debashish Prusty, additional secretary, Department of Financial Services.
Prusty suggested that the re/insurers should explore the future roadmap in three steps: achieving sovereignty in maritime trade through development of a P&I product domestically, scaling up of BMI pool covers to selective ocean-going vessels in collaboration with MoPSW and exploring potential integration with International Group P&I Clubs (IG) Clubs through mutual club formation, compatible with international regulations and standards.
Director General (Shipping) pointed out that there has been a 36% growth in Indian tonnage in Indian shipping since 2015, reaching a total of 1600 vessels.
As on March 1, there has been a 86% decline in the traffic in Strait of Hormuz and 10% increase in oil prices as a result of the current geopolitical instability was also brought out. He commended the efforts of government in ensuring continuous insurance coverage for maritime trade through the BMIP.
Girija Subramanian, CMD, New India Assurance addressed the BMIP as a platform to explore ways to achieve a reliable, sustainable and internationally respectable P&I Protection and Indemnity (P&I) framework to satisfy Indian requirements.
Hitesh Joshi, CMD, GIC Re, the pool manager, also acknowledged the potential of BMI pool to provide the needed support for insuring maritime risks and help achieve sovereign control over an essential aspect of trade of the country.
GIC Re attended to the queries/clarifications sought by the shipowners and their associations regarding coverage under the pool. Further, deliberations were made with marine underwriters, ship owners and other stakeholders like adjustors and correspondents in respect of devising a P&I insurance product to cater to the immediate P&I insurance needs of the country.
The workshop brought together key stakeholders from the maritime sector, including shipowners, cargo owners and shipping lines, to discuss maritime insurance solutions and the future development of the sector.
Maritime trade has come under significant pressure in the present global environment, marked by increasing volatility and geopolitical instability.
Further, there is high dependence of Indian vessels on IG P&I Clubs for P&I insurance covering third-party liabilities. The benefit of sovereign guarantee is extended under the pool to the client/ship owners by charging lower premiums making insurance for maritime trade affordable.