The Indian Insurance Sector Creates a ₹500 crore Fertilizer Pool

According to a senior industry official, the Indian Insurance Sector has established a Rs 500 crore "fertiliser pool" to provide insurance coverage for fertilisers imported from Russia and Belarus.

"With European reinsurers not willing to provide reinsurance support to imports from Russia and Belarus and while India imports a sizable volume of its fertilisers from these two countries, the non-life insurance industry has decided to create a Rs 500 crore pool," the senior industry official preferring anonymity told IANS.

According to the official, the national reinsurer General Insurance Corporation of India (GIC Re) will contribute the majority of the pool amount, and all other multi-line non-life insurers will also contribute to the pool corpus. Because of Russia's military action in Ukraine, reinsurers in Europe and the United States are refusing to provide reinsurance coverage for goods leaving Russia and Belarus.

After deducting some administrative costs, the premiums collected by the primary insurers to insure fertiliser imports will be ceded to the pool. If there are any claims, they are paid from the pool. This will be India's third insurance pool, following terrorism and nuclear insurance pools. The Insurance Regulatory and Development Authority of India has approved the fertiliser pool (IRDAI).