Chapter II
SPECIFIC PROVISIONS
Section 1. LIABILITIES FOR PARTICIPATION IN COMPULSORY INSURANCE FOR CONSTRUCTION INVESTMENT ACTIVITIES
Article 4. Entities required to buy compulsory insurance for construction investment activities
1. Except for construction works related to national defence, security and state secret, project owners or contractors that fall within the case in which construction insurance premiums have been included in the contractual price must buy construction insurance which is valid during the construction period with respect to the following construction works:
a) Construction projects or project items which have certain impacts on public safety as stipulated by Appendix II of the Government’s Decree No. 46/2015/ND-CP dated May 12, 2015 on construction quality management and maintenance and written amendments, modifications or substitutions (if any);
b) Construction projects having significant environmental impacts that belong to the list of projects subject to environmental impact assessment under the provisions of the Appendix II and III of the Government's Decree No. 18/2015/ND-CP dated February 14, 2015 on the scheme for environmental protection, strategic environmental assessment, environmental impact assessment and the plan for environmental protection in association with written amendments, modifications or substitutions (if any);
c) Construction projects which have particular technical specifications and are subject to complicated construction requirements in accordance with laws on construction and other relevant legislation.
2. Consultancy service contractors must buy professional liability insurance for provision of construction consultancy service with respect to the work of construction surveying and design for construction projects ranked II or higher.
3. Engineering construction contractors must buy insurance policies for employees working at construction sites.
Article 5. Insurance validity period
1. The validity period of construction insurance during the construction progress means the specific time period from the opening date to the closing date of construction activities with reference to the investment decision (even including any modification or amendment if possible) issued by a competent authority and agreed upon in an insurance contract
2. Professional liability insurance for construction consultancy service shall be valid from the date on which agreed construction consultancy service is rendered to the date on which the warranty term of construction works ends in accordance with laws.
3. Insurance for employees working at construction sites shall be valid from the date on which they start performing their work to the date on which the warranty term of construction works ends in accordance with laws. The determination of specific validity period of insurance for employees working at construction sites shall be consistent with their employment contracts.
Article 6. Scope of insurance coverage and denial of coverage
1. Scope of insurance coverage
a) With respect to insurance for works in progress: An insurance enterprise shall perform its duty to provide insurance cover against losses, claims or damages that may arise from all risks, except for losses referred to in paragraph 2 of this Article.
b) With respect to professional liability insurance for construction investment consultancy: An insurance enterprise shall pay a construction consultancy contractor sums as an insurance cover which such contractor has its duty to provide a damage against losses or claims for a third party and pay related statutory costs incurred from provision of a construction consultancy service, except for losses or damages stipulated in paragraph 2 of this Article;
c) With respect to insurance for employees working at construction sites: An insurance enterprise shall be liable to pay a construction contractor sums as an insurance cover which such contractor has its duty to provide damages for these employees who suffer injury or death caused by work accidents or occupational diseases that fall within the scope of insurance coverage.
2. Denial of coverage
Insurance enterprises shall not have duties to pay insurance cover against the following losses or damages
a) Those that arise from intentional acts;
b) Those which are not incidental ones;
c) Those which are not quantified by monetary amounts;
d) Catastrophic losses or damages;
dd) Those that arise from the case in which insurance buyers have no insurable interests.
3. The Ministry of Finance shall provide guidance on implementation of paragraph 1 and 2 of this Article.
Section 2. CONDITIONS FOR SALE OR PURCHASE OF COMPULSORY INSURANCE FOR CONSTRUCTION INVESTMENT ACTIVITIES
Article 7. Conditions with respect to insurance enterprises and reinsurance enterprises
Insurance enterprises and reinsurance enterprises shall be allowed to sell compulsory insurance for construction investment activities provided that they meet the following conditions:
1. Hold permits for establishment and operation in which property and loss insurance, liability insurance (with respect to insurance enterprises), and non-life reinsurance (with respect to reinsurance enterprises), are licensed.
2. Meet requirements as to financial capability and professional competence of staff members as prescribed by the Law on Insurance Business and other instructional documents.
Article 8. Conditions with respect to reinsurance assuming enterprises or foreign reinsurance assuming organizations
As for outbound reinsurance activities, insurance enterprises and reinsurance enterprises must provide reinsurance for reinsurance assuming enterprises and foreign reinsurance assuming organizations that meet the following conditions:
1. Legally operating within the territory of the country where these enterprises' main offices are located.
2. Attain the minimum rank of “BBB” accredited by Standard & Poor’s or “B++” accredited by A.M.Best or the equivalent ranks accredited by other organizations that have competence and experience in rating in the financial year closest to the reinsurance assuming year.
Article 9. Retained liability
In order to ensure the financial safety for insurance enterprises and reinsurance enterprises and interests offered to insurance buyers, in reliance on financial capability and risk assessment result, insurance enterprises and reinsurance enterprises shall decide to provide compulsory insurance or reinsurance for construction investment activities as follows:
1. Retained liability per each risk or single loss or damage shall not exceed 10% of the owner’s equity.
2. If an insurance enterprise cedes reinsurance under a fronting arrangement, the maximum rate of such reinsurance cession is 90% of total insurance coverage.
Section 3. SUM ASSURED, RULES OF DETERMINATION OF INSURANCE PREMIUM
Article 10. Sum assured
1. With respect to insurance for works in progress: The sum assured is the full value of construction works upon completion but shall not be allowed to be lower than total construction contract value, including the value subject to amendments or revisions (if any).
2. With respect to professional liability insurance for construction investment consultancy: The sum assured equals consultancy and design contract value.
3. With respect to insurance for employees working at construction sites: The sum assured equals VND 100 million/policyholder/case. The specific coverage provided for employees that suffer injury or death caused by work accidents or occupational diseases shall be governed under the direction of the Ministry of Finance.
Article 11. Rules of determination of insurance premiums
Insurance premiums paid for compulsory insurance for construction investment activities must be determined by consulting statistical data and payment capacity of insurance enterprises and must be consistent with the guidance on insurance conditions, scope of insurance coverage and sum assured provided by the Ministry of Finance.
Tìm kiếm
Nghị định 119/2015/NĐ-CP (Bản Pdf)
Nghị định 119/2015/NĐ-CP (Bản Word)
