The Iffco Tokio Insurance has designed a policy called the Sagar Bandhu Bima policy for the small coastal or inland vessel operators. This policy was launched on 26th November 2005 after the approval from the IRDA.
In India there are various policies that cover for the Hull and machinery of coastal or inland vessels according to the Institute Time Clause Hull of 1st October of 1983. This clause also provide 3/4th collision liability along with the cover of Hull and Machinery. But according to the Institute of Port Risks clause of 20th July of 1987, the cover provides 4/4th collision liability along with wreck removal subject to the limit of the insured sum of the Hull and Machinery.
Through international clubs the large vessel operators can avail the P&I Cover while the small vessel operators were trying to protect it from potential liabilities incurred from wreck removal and collision liability with FIFO (fixed and floating objects) provided if these exceed the value of the vessel.
According to the policy of the Sagar Bandhu Bima policy it covers against:
As per the Institute Port Risks clause of 1987, the 4/4th collision liability and wreck removal is covered under the Hull and Machinery.
The liabilities that are covered under the protection and indemnity cover are as followed:
1. Damage to other vessels
2. Wreck removal
3. Damage/loss to third party property
4. Persons other than crew
6. Pollution risks
7. Damage to cargo