Latest regulations on disclaimer clauses in Vietnam

Latest regulations on disclaimer clauses in Vietnam (Internet image)

1. Latest regulations on disclaimer clauses in Vietnam

The exclusion clauses in insurance liability according to Article 19 of the Law on on insurance business 2022 are as follows:

• The exclusion clauses in insurance liability stipulate the cases in which insurers, foreign non-life insurance branches, are not required to indemnify or pay insurance benefits.

• In case there are exclusion clauses in insurance liability, the insurer or foreign non-life insurance branch must clearly state them in the insurance contract, explain clearly and fully, and have proof confirming that the insurance buyer has been fully informed and understands this content when entering into the insurance contract.

• In the event of force majeure or objective obstacles leading to a delay in the insurance buyer's notification of the insurance event, the insurer or foreign non-life insurance branch may not apply the exclusion clauses in insurance liability regarding the delay in notification.

2. Legal consequences of unilateral termination of insurance contracts in Vietnam

Legal consequences of unilateral termination of insurance contracts in Vietnam according to Article 27 of the Law on on insurance business 2022 are as follows:

• In the case of unilateral termination of the insurance contract stipulated in Clause 1, Article 26 of the Law on on insurance business 2022, the following actions will be taken:

• The insurance buyer must still pay the full insurance premium up to the time of unilateral termination of the insurance contract. This provision does not apply to life insurance contracts or health insurance contracts, except for group insurance contracts.

• For life insurance contracts and health insurance contracts, insurers or foreign non-life insurance branches are responsible for paying insurance benefits to the insured when the insurance event occurs before the time of unilateral termination of the insurance contract and have the right to deduct the insurance premium up to the time of unilateral termination of the insurance contract.

• For property insurance contracts, damage insurance contracts, and liability insurance contracts, insurers or foreign non-life insurance branches are responsible for indemnifying the insured when the insurance event occurs before the time of unilateral termination of the insurance contract and have the right to deduct the insurance premium according to the agreement in the insurance contract.

• In the case of unilateral termination of the insurance contract stipulated in Clauses 2 and 3, Article 26 of the Law on on insurance business 2022, insurers or foreign non-life insurance branches are responsible for refunding the paid insurance premium for the remaining period of the insurance contract according to the agreement in the insurance contract.

Insurers or foreign non-life insurance branches are responsible for indemnifying or paying insurance benefits according to the agreement in the insurance contract when the insurance event occurs before the time of unilateral termination of the insurance contract.

• In the case of unilateral termination of the insurance contract stipulated in Clauses 1 and 2, Article 26 of the Law on on insurance business 2022, for life insurance contracts with refundable value, the insurer must pay the insurance buyer the refundable value of the insurance contract, except where the parties have another agreement.

• In the case of unilateral termination of the insurance contract stipulated in Clause 4, Article 26 of the Law on on insurance business 2022, the insurance buyer is entitled to receive the refundable value or the paid insurance premium corresponding to the remaining period of the insurance contract according to the respective insurance product.

In case the asset value is lower than the technical reserve of the transferred insurance contract portfolio, the amount received by the insurance buyer is calculated based on the ratio between the asset value and the technical reserve of the transferred insurance contract portfolio.

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