Insuring the Fleet: India Builds a Sovereign Alternative to the London P&I Clubs
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Article summary
The Department of Financial Services under the Ministry of Finance launched India's first sovereign-backed Protection and Indemnity insurance product on 30 July 2026, under the Bharat Maritime Insurance Pool. The pool was approved by the Union Cabinet with a sovereign guarantee of ₹12,980 crore and became operational on 12 May 2026, initially covering war risks. The new product, designed by The New India Assurance Company Limited, covers third-party liabilities including crew and cargo liability, pollution liability and wreck removal, with an indemnity limit of up to 1.5 billion dollars from the pool's combined underwriting capacity, plus access to a 24x7 global port correspondent network. As of 29 July 2026 the pool had issued 1,608 policies across cargo war and hull war risks, and its creation has been associated with a 35 to 40 per cent fall in war-risk premium rates from their peak during the West Asia conflict.
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Sample questions — answers revealed after test
Q1. Protection and Indemnity (P&I) insurance in shipping covers which of the following?
Q2. Why has Protection and Indemnity insurance become an effective instrument of maritime sanctions?
Q3. Consider the following statements about the Bharat Maritime Insurance Pool: 1. It was approved by the Union Cabinet with a sovereign guarantee of ₹12,980 crore and became operational on 12 May 2026. 2. Its sovereign P&I product carries an indemnity limit of up to 1.5 billion dollars and was designed by The New India Assurance Company Limited. 3. Because the pool now exists, an Indian P&I certificate is automatically accepted by ports and charterers worldwide. Which of the statements given above are correct?