Local ship cover may get an India club flavour
India plans to set up its own protection and indemnity (P&l) entity called India Club for providing third-party maritime insurance to Indian ships operating in the country’s coastal regions and inland waterways, a top government official said. Coverage for shipping in international waters may come at a later point. Such an entity would provide insurance cover for unforeseen situations such as damage caused to cargo during carriage, damages from war, and from environmental risks.
Regular marine insurance covers only the hull and machinery of ships. “Considering the large-sized coverage required for ships moving on international routes, we are looking to have this P&I cater to coastal shipping and inland waterways as a start," T.K. Ramachandran, secretary in the Union ministry of ports, shipping and waterways, said.
“The details and modalities of this entity are still being worked out, but the ministry is ready to provide any seed money required for the initiative." The ports ministry is attempting to help form a coalition of domestic fleet owners operating on coastal and inland waterways routes for the P&I entity. Public sector insurance companies such as New India Assurance and GIC Re are also being tapped to partner in the initiative. A local P&I entity supported by the government may also turn out cheaper for shipping lines that currently depend on foreign entities.
A P&I club operates like a cooperative. Its members pay an annual fee, which is then pooled to provide the base for the third-party insurance. Such members would include shipowners, cargo operators, charterers, freight forwarders and warehouse owners.
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