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According to Mr. Nguyen Huu Khanh (Hanoi), in the process of implementing compulsory insurance for works during the construction period according to Decree No. 67/2023/ND-CP, there are different understandings between insurance companies and insurance buyers about determining the rate and proportion of installation work in the total value of construction items to calculate insurance premiums. Specifically, a construction investment project Construction of an industrial factory has a total value of 500 billion VND, of which the construction part is 300 billion VND, the equipment installation part is 200 billion VND. The insurance company determined that the installation cost accounts for 40% of the total value of the project, so it is classified into the group of projects with an installation rate of less than 50%. Meanwhile, the insurance buyer believes that the installation cost accounts for 66.7% of the construction part, so it belongs to the group of 50% or more. Mr. Khanh requested the authorities to specifically guide how to determine the percentage of installation costs in the total value of the project as a basis for calculating mandatory insurance fees in accordance with the provisions of Decree No. 67/2023/ND-CP. Regarding this issue, the Department of Insurance Management and Supervision, Ministry of Finance has The opinion is as follows: Article 33 of Decree No. 67/2023/ND-CP of the Government stipulates that the minimum insurance amount for compulsory insurance for works during the construction period is the full value of the work when completed, including all materials, labor costs, equipment installed in the work, transportation costs, other taxes, fees and other items provided by the investor. The minimum insurance amount for a project during the construction period must not be lower than the total value of the construction contract, including the adjusted and additional value (if any). According to Clause 1, Article 37 of Decree No. 67/2023/ND-CP, the insurance premium and insurance deduction level are specified as follows: 1. The insurance premium and compulsory insurance deduction level for the project during the construction period are specifically regulated as follows: a) For construction projects with a value of less than 1,000 billion VND, excluding installation work or including installation work but the cost of performing the installation work is less than 50% of the total value of the insured construction work item: Insurance premium and insurance deduction level specified in Clause 1, Section I, Appendix III issued with this Decree.b) For construction works worth less than 1,000 billion VND, including installation work and expenses The cost of performing the installation work accounts for 50% or more of the total value of the insured construction work item: The insurance premium and insurance deduction level are specified in Clause 1, Section II, Appendix III issued with this Decree.c) For construction works with a value of 1,000 billion VND or more specified in Points a and b of this Clause: The insurance enterprise and the insurance buyer can agree on the insurance premium and insurance deduction level on an equal basis. proof that the leading foreign insurance enterprise or organization receiving reinsurance confirms that the leading foreign insurance enterprise or organization receiving reinsurance and the foreign insurance enterprise or organization receiving reinsurance from 10% of the total liability of each reinsurance contract must meet the provisions of Clause 9, Article 4 of this Decree. In all cases, the insurance premium must not be lower than the insurance premium corresponding to 1,000 billion VND multiplied by (x) 75%. insurance premium rates specified in Clause 1, Section I, Appendix III issued with this Decree (for works specified in Point a, Clause 1 of this Article) or Clause 1, Section II, Appendix III issued with this Decree (for works specified in Point b, Clause 1 of this Article). insurance and insurance deductible levels based on evidence proving that the leading foreign insurance enterprise or organization receiving reinsurance confirms reinsurance in accordance with the rules, terms, insurance premiums and insurance deductible levels that the insurance enterprise provides to the insurance buyer. The leading foreign insurance enterprise or organization receiving reinsurance and the foreign insurance enterprise or organization receiving reinsurance from 10% of the total liability of each reinsurance contract must meet the provisions in Clause 9, Article 4 of this Decree. Clause 5, Article 75 of Decree No. 67/2023/ND-CP stipulates the responsibility of insurance enterprises to clearly explain insurance conditions, insurance premiums, minimum insurance amount, ensuring that the insurance buyer and the insured clearly distinguish between the type of compulsory insurance and other types of voluntary insurance. Compulsory insurance in construction activities has been fully regulated. Therefore, we recommend that you base on the relevant legal regulations and specific documents to comply with the legal regulations on insurance business and other relevant legal regulations. In case it is unclear, regarding the insurance contract, please contact the insurance company to clearly explain the conditions, fees, insurance amount... according to the provisions of Clause 5, Article 75 of Decree No. 67/2023/ND-CP.The Department of Insurance Management and Supervision, Ministry of Finance would like to inform Mr. Nguyen Huu Khanh.Chinhphu.vnSee moreInstructions for determining the deduction level for construction insurance.See moreBases for reducing construction insurance premiums.See moreConstruction insurance premium rates in bidding documents.See moreHow to calculate estimates for construction insurance packages.See moreBases for calculating construction insurance premiums.
