Putin proposes BRICS insurance mechanism to bypass Western sanctions

During the 18th BRICS Summit in New Delhi, Russian President Vladimir Putin proposed the establishment of a new, independent insurance mechanism to support the BRICS common market. A primary objective of this proposal is to provide coverage for essential trade, including the grain market, and to mitigate the impact of Western sanctions.

The initiative aims to bypass restrictions imposed by the European Union and the G7, specifically the $60 per barrel price cap on Russian crude oil. Currently, Western insurers and the International Group of P&I Clubs hold significant leverage over oil revenues by restricting coverage for shipments exceeding the price cap. This has led to the emergence of a ‘shadow fleet,’ with approximately 800 tankers operating outside traditional international insurance coverage.

While specific operational details for the proposed BRICS mechanism have not been released, Putin emphasized that BRICS nations have already developed independent channels for capital, labor, and technology. The proposal may also involve the New Development Bank (NDB) to support these financial structures. Industry experts note that while new players are emerging, any future integration with international insurance groups would require these entities to prove they were not complicit in circumventing existing regulations.