UPSC Prelims Practice Questions — Cabinet approves proposal for creation of ‘Bharat Maritime Insurance Pool’ (BMI pool) with a sovereign guarantee of Rs 12,980 crore to facilitate continuous maritime insurance coverages

Q1. With reference to the financial architecture of the Bharat Maritime Insurance Pool approved in 2026, consider the following: 1. The sovereign guarantee extended to the pool is Rs 12,980 crore. 2. The combined underwriting capacity of the pool is about Rs 950 crore. 3. Claims up to USD 100 million are serviced from the pool's own capacity. 4. The entire USD 1.5 billion pool is funded solely by the sovereign guarantee. Which of the above is/are correctly identified?

  1. The sovereign guarantee extended to the pool is Rs 12,980 crore.
  2. The combined underwriting capacity of the pool is about Rs 950 crore.
  3. Claims up to USD 100 million are serviced from the pool's own capacity.
  4. The entire USD 1.5 billion pool is funded solely by the sovereign guarantee.
  • A. 1 and 3
  • B. 1, 2 and 3
  • C. 2 and 4
  • D. 1, 2, 3 and 4

Q2. Among the following monetary figures associated with the Bharat Maritime Insurance Pool, which one is the largest?

  • A. The total size of the pool, USD 1.5 billion
  • B. The sovereign guarantee backing the pool, USD 1.4 billion
  • C. The combined underwriting capacity of the pool, about Rs 950 crore
  • D. The single-claim amount serviced from the pool's own capacity, USD 100 million

Q3. With reference to the institutions associated with the Bharat Maritime Insurance Pool, consider the following: 1. The Directorate General of Shipping is a partner in the pool's operationalisation. 2. The General Insurance Council is associated with the pool. 3. New India Assurance, among other domestic insurers, participates as a member issuing policies. 4. The Insurance Regulatory and Development Authority of India (IRDAI) is the designated administrator of the pool. Which of the above is/are NOT correctly identified?

  1. The Directorate General of Shipping is a partner in the pool's operationalisation.
  2. The General Insurance Council is associated with the pool.
  3. New India Assurance, among other domestic insurers, participates as a member issuing policies.
  4. The Insurance Regulatory and Development Authority of India (IRDAI) is the designated administrator of the pool.
  • A. 1 only
  • B. 4 only
  • C. 3 and 4
  • D. 1 and 2

Q4. Which one of the following is the nodal department that launched the Bharat Maritime Insurance Pool?

  • A. Department of Financial Services, Ministry of Finance
  • B. Directorate General of Shipping, Ministry of Ports, Shipping and Waterways
  • C. Department of Economic Affairs, Ministry of Finance
  • D. Department of Commerce, Ministry of Commerce and Industry

Q5. With reference to the types of marine insurance cover provided under the Bharat Maritime Insurance Pool, consider the following statements: 1. Hull and Machinery insurance covers physical damage to the vessel itself, whereas Protection and Indemnity (P&I) cover addresses third-party liabilities such as crew injury and pollution. 2. Unlike Hull and Machinery cover, P&I cover is traditionally provided through a mutual model in which members pool resources and share risks. 3. War-risk perils are always included by default within standard Hull and Machinery marine policies. Which of the statements given above is/are correct?

  1. Hull and Machinery insurance covers physical damage to the vessel itself, whereas Protection and Indemnity (P&I) cover addresses third-party liabilities such as crew injury and pollution.
  2. Unlike Hull and Machinery cover, P&I cover is traditionally provided through a mutual model in which members pool resources and share risks.
  3. War-risk perils are always included by default within standard Hull and Machinery marine policies.
  • A. 1 and 2 only
  • B. 2 and 3 only
  • C. 1 and 3 only
  • D. 1, 2 and 3

Q6. Open-ended shipowner liabilities that traditional insurers are reluctant to cover — such as pollution, wreck removal and crew injury — are conventionally underwritten worldwide by which one of the following?

  • A. Protection and Indemnity (P&I) Clubs
  • B. Hull and Machinery underwriters
  • C. Cargo insurance syndicates
  • D. Export credit guarantee agencies

Q7. India's marine war-risk reinsurance has historically been concentrated in which one of the following markets, whose constrained availability during 2025 geopolitical tensions the Bharat Maritime Insurance Pool seeks to counter?

  • A. The Lloyd's of London market
  • B. The New York marine insurance market
  • C. The Singapore reinsurance market
  • D. The Tokyo marine insurance market

Q8. With reference to the rationale for the Bharat Maritime Insurance Pool relative to existing arrangements, consider the following statements: 1. The pool is intended to complement, rather than wholly replace, the International Group of P&I Clubs. 2. Indian-flagged vessels have historically relied on the International Group of P&I Clubs for their protection and indemnity cover. 3. The pool eliminates entirely India's need for any foreign reinsurance arrangements. Which of the statements given above is/are correct?

  1. The pool is intended to complement, rather than wholly replace, the International Group of P&I Clubs.
  2. Indian-flagged vessels have historically relied on the International Group of P&I Clubs for their protection and indemnity cover.
  3. The pool eliminates entirely India's need for any foreign reinsurance arrangements.
  • A. 1 and 2 only
  • B. 1 and 3 only
  • C. 2 and 3 only
  • D. 1, 2 and 3

Q9. The Maritime Amrit Kaal Vision 2047, the long-term policy framework within which the Bharat Maritime Insurance Pool ecosystem sits, outlines approximately how many actionable initiatives?

  • A. More than 100
  • B. More than 300
  • C. More than 600
  • D. More than 1,000

Q10. The India Nuclear Insurance Pool — frequently cited as a precedent for a GIC Re-managed risk pool of national significance — provides cover for liabilities arising under which one of the following?

  • A. Civil Liability for Nuclear Damage Act, 2010
  • B. Atomic Energy Act, 1962
  • C. Insurance Act, 1938
  • D. Marine Insurance Act, 1963

Q11. With reference to India's maritime trade profile, consider the following statements: 1. Nearly 95% of India's trade by volume is handled through maritime transport. 2. Indian-flagged vessels account for roughly 40% of global deadweight tonnage. 3. India's heavy dependence on foreign-flagged vessels increases foreign-exchange outgo on freight payments. Which of the statements given above is/are correct?

  1. Nearly 95% of India's trade by volume is handled through maritime transport.
  2. Indian-flagged vessels account for roughly 40% of global deadweight tonnage.
  3. India's heavy dependence on foreign-flagged vessels increases foreign-exchange outgo on freight payments.
  • A. 1 and 2 only
  • B. 1 and 3 only
  • C. 2 and 3 only
  • D. 1, 2 and 3

Q12. With reference to the institutional and governance architecture of the Bharat Maritime Insurance Pool, consider the following: 1. GIC Re is the administrator of the pool, submitting returns and statements on the pool's performance. 2. A Governing Body oversees the pool, including decisions on invoking the sovereign guarantee. 3. An Underwriting Committee ensures prudent and technically sound underwriting of risks ceded to the pool. 4. The sovereign guarantee is invoked as the first line of payment for every claim on the pool. Which of the above is/are correctly identified?

  1. GIC Re is the administrator of the pool, submitting returns and statements on the pool's performance.
  2. A Governing Body oversees the pool, including decisions on invoking the sovereign guarantee.
  3. An Underwriting Committee ensures prudent and technically sound underwriting of risks ceded to the pool.
  4. The sovereign guarantee is invoked as the first line of payment for every claim on the pool.
  • A. 1, 2 and 3
  • B. 1 and 4
  • C. 2, 3 and 4
  • D. 1, 2, 3 and 4