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Official Gazette

Thursday, October 28, 2021

Civil liability insurance to be compulsory in construction investment

Updated: 09:24’ - 30/07/2021

Construction contractors would have to purchase civil liability insurance for third parties, apart from insurance for workers working on construction sites as currently. Insurance premiums would be included in production and business expenses.

The scene of a scaffolding collapse incident at the construction site of Formosa’s Son Duong wharf in Vung Ang economic zone (Ha Tinh province) in 2015__Photo: baodansinh.vn          

According to the draft decree prepared by the Ministry of Finance to replace Decree 119 of 2015, the duration of civil liability insurance for a third party would be a specific timespan, counting from the date of commencement of construction activities to the end of the work warranty period.

Insurance businesses would pay to construction contractors money amounts payable by construction contractors to third parties as indemnities for out-of-contract losses related to health, life and property which occur in the course of work construction and are covered by liability insurance as agreed upon in insurance policies.

The minimum indemnity of VND 100 million (USD 4,300) per person per case, equivalent to 30 months’ current average region-based minimum wage, would be paid for health damage or life loss incurred to a third party.

The specific minimum indemnity for property damage would be determined based on the value of works. Specifically, for works the valued at under VND 1 trillion (USD 43 million), the minimum indemnity would be 10 percent of the value of works for the entire insurance period. As for those valued at VND 1 trillion or higher, the minimum indemnity would be VND 100 billion (USD 4.3 million) for the whole insurance period.- (VLLF)

 

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