In what cases does an insurance company not have the responsibility to compensate for compulsory fire and explosion insurance in Vietnam?
In what cases does an insurance company not have the responsibility to compensate for compulsory fire and explosion insurance in Vietnam? - Mr. Bao (Ha Noi).
What types of assets are covered by compulsory fire and explosion insurance in Vietnam?
Pursuant to Article 23 of Decree 67/2023/NĐ-CP, the following provisions on the object of insurance are regulated:
Object of insurance
1. The object of compulsory fire and explosion insurance is the entire property of the facility with a fire and explosion hazard, including:
a) Houses, buildings and assets attached to houses, buildings; machinery and equipment.
b) All types of goods and materials (including raw materials, semi-finished products, finished products).
2. The object of insurance and the location of the object of insurance must be clearly stated in the insurance contract and the insurance certificate.
Thus, the object of compulsory fire and explosion insurance includes the following types of assets:
- Houses, buildings and assets attached to houses, buildings; machinery and equipment.
- All types of goods and materials (including raw materials, semi-finished products, finished products).
What is the amount of compulsory fire and explosion insurance determined if the market value of the asset cannot be determined in Vietnam?
Pursuant to Article 24 of Decree 67/2023/NĐ-CP stipulating minimum insurance amount as follows:
Minimum insurance amount
1. The minimum compulsory fire and explosion insurance amount is the value in money calculated according to the market value of the assets specified in Clause 1, Article 23 of this Decree at the time of conclusion of the insurance contract.
2. In case the market value of the asset cannot be determined, the compulsory fire and explosion insurance amount shall be agreed upon by the parties as follows:
a) For assets specified in Point a, Clause 1, Article 23 of this Decree: The insurance amount is the value in money of the asset calculated according to the remaining value or replacement value of the asset at the time of conclusion of the insurance contract.
b) For assets specified in Point b, Clause 1, Article 23 of this Decree: The insurance amount is the value in money of the asset based on invoices, valid documents, or relevant documents.
Therefore, if the market value of the asset cannot be determined, the compulsory fire and explosion insurance amount shall be determined as follows:
- For assets that are houses, buildings and assets attached to houses, buildings; machinery and equipment: The insurance amount is the value in money of the asset calculated according to the remaining value or replacement value of the asset at the time of conclusion of the insurance contract.
- For assets that are types of goods and materials (including raw materials, semi-finished products, finished products): The insurance amount is the value in money of the asset based on invoices, valid documents, or relevant documents.
In what cases does an insurance company not have the responsibility to compensate for compulsory fire and explosion insurance in Vietnam?
Pursuant to Clause 2 Article 25 of Decree 67/2023/NĐ-CP stipulating as follows:
Scope of insurance and exclusion of liability
1. Scope of insurance:
Insurance companies are responsible for compensating for losses to the insured property specified in Clause 1, Article 23 of this Decree arising from the risk of fire and explosion, except for the cases specified in Clause 2, Clause 3 of this Article.
2. Exclusion of liability for insurance against facilities with fire and explosion hazards under the regulations of the fire and rescue law (excluding nuclear facilities): Insurance companies are not responsible for compensating for insurance in the following cases:
a) Earthquakes, volcanic eruptions, or other natural disasters.
b) Damage caused by political, security, and social security and safety incidents.
c) Property is burned or exploded by decision of a competent state agency.
d) Property that ferments or generates heat naturally; property that is affected by a heat-using processing process.
e) Lightning strikes directly into the insured property but does not cause fire or explosion.
f) Nuclear weapon materials cause fire or explosion.
g) Machinery, electrical equipment, or parts of electrical equipment are damaged due to the direct impact of overload, overpressure, short circuit, self-heating, electric arc, or leakage of electricity due to any cause, including lightning strike.
h) Damage caused by intentional acts of arson by the insured; due to intentional violation of fire prevention and fighting regulations and is the direct cause of fire and explosion.
i) Damage to data, software, and computer programs.
k) Damage caused by burning forests, bushes, grasslands, or burning with the purpose of clearing fields and land.
3. Exclusion of liability for insurance against nuclear facilities: Insurance companies and policyholders agree on the cases of exclusion of liability on the basis of the approval of the reinsurance company.
As regulations above, an insurance company does not have the responsibility to compensate for compulsory fire and explosion insurance in Vietnam in following cases:
- Earthquakes, volcanic eruptions, or other natural disasters.
- Damage caused by political, security, and social security and safety incidents.
- Property is burned or exploded by decision of a competent state agency.
- Property that ferments or generates heat naturally; property that is affected by a heat-using processing process.
- Lightning strikes directly into the insured property but does not cause fire or explosion.
- Nuclear weapon materials cause fire or explosion.
- Machinery, electrical equipment, or parts of electrical equipment are damaged due to the direct impact of overload, overpressure, short circuit, self-heating, electric arc, or leakage of electricity due to any cause, including lightning strike.
- Damage caused by intentional acts of arson by the insured; due to intentional violation of fire prevention and fighting regulations and is the direct cause of fire and explosion.
- Damage to data, software, and computer programs.
- Damage caused by burning forests, bushes, grasslands, or burning with the purpose of clearing fields and land.
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