This is a notable content mentioned in the Decree No. 03/2021/NĐ-CP on compulsory civil liability insurance of motor vehicle users issued by the Government of Vietnam on January 15, 2021.
Article table of contents
Specifically, according to Articles 10 and 11 of the Decree No. 03/2021/NĐ-CP of the Government of Vietnam, there are 03 cases of termination of insurance contracts, including:
Case 1: Insurance contracts shall be terminated in case vehicle registration certificates or vehicle license plates must be revoked according to the Ministry of Public Security of Vietnam
Insurance buyers and insurance beneficiaries must inform insurance enterprises in writing, attach certificates of insurance to be terminated and certification for revocation of vehicle registration certificates, license plates or decisions of competent agencies on revoking vehicle registration certificates, license plates.
Within 5 working days from the date on which notice is received, insurance enterprises must refund insurance premiums to insurance buyers and insurance beneficiaries corresponding to the remaining duration of insurance contracts in which insurance buyers and insurance beneficiaries have paid insurance premiums after deducting reasonable costs related to insurance contracts.
Note: Insurance enterprises shall not refund insurance premiums in case insured events have occurred and compensation liabilities have derived before insurance contracts are terminated.
Case 2: Insurance contracts shall be terminated in case motor vehicle users fail to adequately pay insurance premiums
Specifically, insurance contracts shall be terminated on the day following the day on which insurance buyers and insurance beneficiaries pay insurance premiums. Within 5 working days from the date on which insurance contracts terminate, insurance enterprises must inform insurance buyers and insurance beneficiaries in writing about terminating insurance contracts and refunding the excess insurance premiums (if any) to insurance buyers and insurance beneficiaries or requesting insurance buyers and insurance beneficiaries to pay insurance premiums up to the point of terminating insurance contracts.
Concurrently, Insurance enterprises are not obliged to compensate insurance beneficiaries in case of insured events. Insurance contracts shall be terminated from the date on which insurance buyers or insurance beneficiaries receive notice on termination of insurance contracts. On the other hand, insurance contracts shall continue to be valid from the date on which motor vehicle users adequately pay insurance premiums and receive written consensus of insurance enterprises.
Note: Insurance enterprises shall not refund insurance premiums in case insured events have occurred and compensation liabilities have derived before insurance contracts are terminated.
Case 3: Insurance contracts shall be unilaterally suspended in case of changes to factors which serve as the basis for calculating insurance premiums thereby lead to increase and/or decrease of insured risks
- If insurance enterprises reject reduction to insurance premiums in case of unilaterally suspending insurance contracts due to changes to factors which serve as the basis for calculating insurance premiums which lead to decrease of insured risks: Insurance buyers must issue written notice within 5 working days from the date on which insurance enterprises refuse to reduce insurance premiums. Insurance contracts shall be terminated from the date on which insurance enterprises receive notice on termination of insurance contracts. (Legal consequences of terminating insurance contracts shall conform to Point b Clause 1 Article 11 of the Decree No. 03/2021/NĐ-CP of the Government of Vietnam).
- If insurance buyers reject increase to insurance premiums in case of unilaterally suspending insurance contracts due to changes to factors which serve as the basis for calculating insurance premiums which lead to increase of insured risks: Insurance enterprises must issue written notice within 5 working days from the date on which insurance buyers reject increase to insurance premiums. Insurance contracts shall be terminated from the date on which insurance buyers receive notice on termination of insurance contracts.
Within 5 working days from the date on which insurance contracts are terminated, insurance enterprises must refund insurance premiums to insurance buyers and insurance beneficiaries corresponding to the remaining duration of insurance contracts which insurance buyers and insurance beneficiaries have paid insurance premiums after deducting reasonable costs related to insurance contracts.
Note: Insurance enterprises shall not refund insurance premiums in case insured events have occurred and compensation liabilities have derived.
Ty Na
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- Decree No. 03/2021/NĐ-CP
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