The insurance agreement between the insurance buyer and the insurance enterprise is expressed in the form of an insurance contract. The insurance contract includes this insurance policy, the insurance claim form, the insurance certificate and the terms of amendment and supplement to the insurance contract (if any). So about the matter “Who has to buy construction insurance in Vietnam?” Let’s find out with LSX in the article below.
Legal grounds
- Decree 119/2015/ND-CP
What is construction insurance?
Construction insurance is a type of insurance that applies to construction works. The risk is compensated when the work occurs material loss during the construction process and is compensated for the 3rd person ie the person who is not part of the project as well as the investor.
The insurance company will compensate for material damage to the work up to the maximum value of the work agreed upon by both parties in the insurance certificate.
Construction work insurance is a mandatory procedure for obtaining permits and executing construction works. When investors want to build public or private works, they must apply for a construction permit and construction insurance is almost a mandatory procedure.
Construction insurance is charged as follows: premium = work value * premium rate in which the premium rate is set by the insurance company, this rate depends on the risk ratio. of the project after being surveyed by an officer of the insurance company.
Construction insurance coverage
For construction insurance during construction: The insurance enterprise is responsible for compensating for losses of construction works arising from all risks. Except for the cases where compensation liability is excluded in Clause 2, Article 6 of this Decree.
For professional liability insurance for construction investment consultancy: The insurance enterprise will indemnify the construction investment consulting contractor with the sums that the consulting contractor has indemnification liabilities, losses to the other party. 3. Relevant expenses as prescribed by law arising from the performance of construction investment consulting work. Except for the cases where compensation liability is excluded in Clause 2, Article 6 of this Decree.
For insurance for construction workers on the construction site: The insurance enterprise is responsible for indemnifying the construction contractor for the sums that the construction contractor is responsible for indemnifying the injured worker. Injury and death caused by labor accidents or occupational diseases are the responsibility of insurance.
Who has to buy construction insurance in Vietnam?
Pursuant to Article 4 of Decree 119/2015/ND-CP stipulating on subjects who must buy compulsory insurance in construction investment activities as follows:
– Except for works related to national defense, security and state secrets, the investor or contractor in case the construction insurance premium has been included in the contract price must buy construction insurance during the construction period. construction for the following projects:
+ Works, work items that affect community safety specified in Appendix II to Decree 46/2015/ND-CP dated May 12, 2015 of the Government on quality management and maintenance of works formulating and amending, supplementing and replacing documents (if any);
+ Construction investment works that have a great impact on the environment on the list of projects that must undergo environmental impact assessment according to the provisions in Appendix II and III of Decree No. 18/2015/ND-CP dated 14 February 2015 of the Government regulations on environmental protection planning, strategic environmental assessment, environmental impact assessment and environmental protection plan and amendment, supplement, and replacement documents (if applicable) yes);
+ The works have specific technical requirements, complicated construction conditions according to the provisions of the law on construction and other relevant laws.
– Consulting contractors must purchase professional liability insurance for construction investment consultancy for construction survey and design work of construction works of grade II or higher.
– Construction contractors must purchase insurance for construction workers on the construction site.
How long is the compulsory insurance period for construction workers on the construction site?
Pursuant to the provisions of Article 5 of Decree 119/2015/ND-CP, the insurance period is as follows:
– The construction insurance period during the construction period is a specific period, counting from the start date to the end date of the construction period based on the investment decision-making authority’s document (including adjusted, supplemented if any) and recorded in the insurance contract.
– The term of professional liability insurance for construction investment consultancy starts from the date of performing the consultancy work until the end of the warranty period for the work as prescribed by law.
– The insurance period for construction workers on the construction site starts from the date of performing the construction work on the construction site until the end of the warranty period for the work as prescribed by law. The determination of the specific insurance period for employees is based on the labor contract.
According to the above regulations, the term of compulsory insurance for construction workers on the construction site is determined based on the labor contract. Specifically, it is calculated from the date of construction work on the construction site to the end of the construction warranty period.
How is the compulsory insurance coverage regulated?
Pursuant to Article 6 of Decree 119/2015/ND-CP stipulating the scope of insurance, the exclusion of insurance liability is as follows:
(1) Coverage
– For construction insurance during construction: The insurance enterprise shall pay compensation for the loss of the construction work arising from all risks, except for the losses specified in Clause 2 of this Article. ;
– For professional liability insurance for construction investment consultancy: The insurance enterprise will indemnify the construction investment consulting contractor the sums that the consulting contractor is responsible for compensating for the losses of the construction project. the third party and relevant costs in accordance with the law arising from the performance of construction investment consulting work, except for the losses specified in Clause 2 of this Article;
– For insurance for construction workers on the construction site: The insurance enterprise is responsible for indemnifying the construction contractor for the sums that the construction contractor is responsible for indemnifying the injured worker. injury, death caused by occupational accident or occupational disease under the insurance responsibility;
(2) Exclusion of insurance liability
The insurer is not liable for the following losses:
– Loss arising from willful acts;
– Loss is not incidental;
– Loss cannot be quantified in monetary terms;
– Catastrophic damage;
– Loss arising in the event that the policyholder has no insurable interest.
Term of construction insurance
The insurer’s liability commences from the commencement of the Works or from the time the insured items named in the Policy are unloaded on the Site, regardless of the commencement of insurance stated in the Policy. may be different.
However, a construction insurance contract becomes effective only after the insured has paid the premium stated in the insurance contract unless otherwise agreed in writing. The premium is determined according to the Construction Insurance Premium Schedule specified in Appendix 3 and the Construction Insurance Surcharge specified in Appendix 4 attached to this Insurance Policy.
For parts and work items that have been handed over or put into use, the insurer’s liability for these parts and work items will cease from the time of handover or put those parts and work items into use.
The insurance contract will terminate on the date specified in the contract. Any extension of the insurance period must be agreed in writing by the insurer.
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Frequently asked questions
Construction works include public buildings, houses, industrial works, traffic, irrigation, energy and other works;
Construction equipment serving the construction process;
Construction machinery serving the construction process;
Installation work serving and/or forming part of the construction process;
Assets available on and within the construction site under the ownership, management, custody and control of the insured;
Liability to third parties.
Point e, Clause 2, Article 5 of the Government’s Decree No. 10/2021/ND-CP on management of construction investment costs, stipulating that the item of insurance costs for works during the construction period falls under other expenses. in the total investment in construction work.
According to Clause 1, Article 4 of the Government’s Decree No. 119/2015/ND-CP stipulating compulsory insurance in construction investment activities, the investor or the contractor (in case the construction insurance premium has already been calculated). in the contract price) must buy construction insurance during the construction period for some types of works.
The level of indemnity for each item of property stated in the insurance contract shall not exceed the sum insured for that item of property. The total sum insured shall not exceed the sum insured specified in the insurance contract. The specific cases are as follows:
1- In the case of a repairable loss that must be repaired, the compensation amount is the necessary cost to restore the damaged items back to the state before the loss occurred after deduction. take the part of the recoverable value and the deductible;
2- In the case of total loss, the amount of compensation is the actual value of the item immediately prior to the loss less recoverable value and deductible.
Conclusion: So the above is Who has to buy construction insurance in Vietnam?. Hopefully with this article can help you in life, please always follow and read our good articles on the website: lsxlawfirm.com
