Shipping Ministry Unveils Two Credit Risk Insurance Products
The Ministry of Ports, Shipping and Waterways has announced two specialised credit risk insurance products to support India’s shipbuilding industry under the National Shipbuilding Mission.
The Shipbuilding Project Credit Risk Insurance Policy (SbPCP), developed by ECGC Ltd, will cover export projects, while the Business Credit Shield Policy Shipbuilders (BCSPS), developed by The New India Assurance Company, will protect domestic projects.
Announcing the initiatives at the 21st Maritime State Development Council meeting, Union Minister Sarbananda Sonowal said the government would subsidise insurance premiums and provide direct support to insurers if shipyards file claims.
Developed under the Shipbuilding Development Scheme, the policies aim to reduce financial stress arising from delayed milestone payments and market uncertainty. The initiative is expected to strengthen shipyard operations, improve financial stability and support the development of India’s domestic shipbuilding capabilities.
Non-Life Insurance Premiums Rise 8.92% in H1 FY27
India’s non-life insurance industry recorded 8.92% year-on-year growth in gross direct premiums, including specialised insurers, to Rs. 1,79,712 crore during April–September FY27, compared with Rs. 1,64,987 crore a year earlier.
Excluding specialised insurers, premiums increased 11.7% to Rs. 1,76,105 crore. The overall performance was affected by a 57.2% decline in Agriculture Insurance Company of India’s premiums to Rs. 2,866 crore.
Standalone health insurers remained a major growth driver, with premiums rising 30.69% to Rs. 25,586 crore. Private general insurers recorded 9% growth to Rs. 1,50,518 crore.
In September, industry premiums increased 6.1% to Rs. 32,951 crore, although growth excluding specialised insurers reached 15%. Standalone health insurers registered 27% growth during the month.
The figures highlight diverging trends across insurance segments, with health insurance expanding strongly while agricultural insurance premiums continued to weigh on overall industry performance.
Employers Can Claim ITC on Group Insurance Coverage
The Goods and Services Tax (GST) Council has announced that input tax credit (ITC) will be available on GST paid for health and life insurance coverage provided by employers to their employees.
The decision is expected to reduce the effective cost of employer-sponsored insurance, particularly for micro, small and medium enterprises (MSMEs), potentially supporting wider adoption of group coverage.
Krishnamoorthy Rao, Managing Director and CEO of Generali Central Insurance, said the measure could improve the economics of group health insurance and create opportunities for employers to enhance benefits, coverage limits and employee eligibility.
According to General Insurance Council data for FY26, group health insurance premiums exceeded Rs. 68,000 crore. The life insurance industry collected approximately Rs. 2.75 trillion in group insurance premiums.
Industry experts believe the availability of ITC could support sustainable growth in employer-sponsored protection. However, the benefit will depend on how employers and insurers translate the lower effective cost into improved coverage and pricing arrangements.
Natural Catastrophes Trigger Property Insurance Rate Increases
Property insurance premiums are facing upward pressure following substantial claims from recent natural disasters, including floods in Gujarat. Industry estimates place losses arising from the Gujarat floods at nearly Rs. 5,000 crore.
Bajaj General Insurance reported that property insurance rates are hardening by approximately 25–30%, primarily through reduced discounts rather than increases in base natural catastrophe (NATCAT) rates.
Gurdeep Singh Batra, Head of Commercial Underwriting at Bajaj General Insurance, cited flood losses and rising Himalayan risks as factors influencing pricing.
The Insurance Regulatory and Development Authority of India (IRDAI) has previously cautioned general insurers against aggressive discounting in fire insurance, including discounts of up to 99% on large industrial risks.
Although increased reinsurance capacity has intensified competition and suppressed premiums, recent losses are prompting insurers to reassess underwriting discipline. NATCAT rates are experiencing more pronounced upward pressure than fire, lightning, explosion and aircraft (FLEXA) rates.
The adjustment reflects insurers’ efforts to restore pricing adequacy and manage catastrophe exposures.
IBAI Warns IRDAI Proposal Could Threaten One Million Livelihoods
The Insurance Brokers Association of India (IBAI) has warned that proposed distribution reforms by the Insurance Regulatory and Development Authority of India (IRDAI) could put at least one million livelihoods at risk over the next five years and potentially revive unethical practices addressed by the 2023 regulations.
In an October 2 letter to Prime Minister Narendra Modi and Finance Minister Nirmala Sitharaman, IBAI opposed introducing more than 30 commission caps across products and distribution channels alongside a proposed one-third reduction in insurers’ overall expense limits. It urged the government to publish an impact assessment before notifying the regulations and retain the existing expense of management framework until its scheduled review in 2028.
Citing FY25 regulatory data, IBAI said insurance distribution supported over 8.3 million professionals. Brokers sponsored 1.48 million of India’s 2.72 million point-of-sale persons, highlighting potential employment and insurance-access implications, particularly in smaller cities.
