Re-imbursement of Paid Marine Insurance on behalf of client

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This query is : Resolved

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This discussion concerns the Goods and Services Tax (GST) and Reverse Charge Mechanism (RCM) applicability for businesses that pay consolidated marine insurance premiums on behalf of their clients. The business acts as an intermediary, covering cargo risks during import and then billing clients for the exact premium paid without any markup. The core question is whether GST or RCM applies to this reimbursement process under business auxiliary services.

Arun Rajbhoj

Arun Rajbhoj (Querist)

07 July 2025 Dear Sir/Madam,

Please assist under business auxiliary services.

We have taken the consolidated marine insurance policy in our name "to cover the risk of loss of cargo/high value shipments" of our clients (consignee/importer).

e.g.
Premium paid to Insurance Company by us on behalf of 'actual clients'.
If any claim during the shipment imports from place of outside of India, it will be settled to beneficiary/clients account directly.
We are providing the additional service to our client to secure the import of goods in Transit.

After successful delivery of the goods, we raise our bill to recipient as Re-imbursement of marine insurance premium paid without addition of margin.

In this matter is there any GST or RCM applicable or not?

Waiting for your reply.