Responsibility for Purchasing Construction Work Insurance: Contractor or Investor?

Based on the provisions of Clause 1 Article 4 Decree 119/2015/ND-CP:

Except for works related to national defense, security, and state secrets, the investor or contractor in cases where construction insurance fees have been calculated into the contract price must purchase construction insurance during the construction period for the following works:

- Works and work items affecting public safety as specified in Appendix II of Decree 46/2015/ND-CP;

- Construction investment projects with significant environmental impacts that are on the list of projects required to carry out environmental impact assessments as stipulated in Appendix II and Appendix III of Decree 18/2015/ND-CP;

- Works with specific technical requirements and complex construction conditions according to the provisions of the construction law and other relevant laws.

Furthermore, Point a Clause 4 Article 3 of this Decree states: For construction insurance during the construction period: Insurance premiums are included in the total construction investment amount.

Combining the above two provisions, for works that are required to purchase insurance during the construction period, the construction insurance premium is naturally calculated into the total construction investment amount. The responsibility for purchasing insurance is with the investor or the construction contractor.

This means that when the insurance premium has been calculated into the total construction investment for the work, the investor and contractor must agree on who will purchase the insurance. Whether or not the parties have addressed this issue during the bidding process, an agreement must eventually be reached to have one party responsible for contacting the insurer and purchasing insurance for the work during the construction period.

Therefore, in your case, the two parties will have to agree to determine the responsibility for purchasing construction insurance.

Sincerely!