Decree 220/2026/ND-CP Amends Mandatory Insurance Rules for Construction Projects, Fire-Explosion and Motor Vehicle Liability
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Based on:220/2026/ND-CP - Government Official Gazette
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Decree 220/2026/ND-CP, issued by the Government on 22 June 2026, amends Decree 67/2023/ND-CP on mandatory motor vehicle civil liability insurance, mandatory fire and explosion insurance, and mandatory insurance for construction activities. It takes effect from 1 July 2026. The most significant change is a newly issued premium schedule (Appendix III) for mandatory construction-period insurance, split into two groups: projects with no or limited equipment-installation work (under 50% of value) and projects where equipment installation makes up 50% or more of value. Premium rates (per mille of project value) and deductible levels are set out in detail by project type - civil, industrial, technical infrastructure, transport, and agriculture and environment works. Insurers may adjust premiums up or down by a maximum of 25% based on risk assessment, but cannot discount below the set rates for projects in high natural-disaster-risk areas or when the insurer has posted a loss on its property insurance line for three consecutive financial years. The decree also clarifies who must buy the insurance: project owners remain primarily responsible even if they delegate purchasing to a contractor; it adds rules on the extra premium due when construction or warranty periods run longer than planned; and it requires survey, design, and construction contractors to supply project-value information so insurers can calculate the correct premium. Insurance contracts signed before the effective date continue under their original terms unless both parties agree to amend them under the new rules. Construction investors (including foreign-invested projects), contractors, and insurers should review mandatory insurance costs in existing contracts and new project budgets.
Overview
Decree 220/2026/ND-CP, issued by the Government on 22 June 2026, amends Decree 67/2023/ND-CP on mandatory motor vehicle civil liability insurance, mandatory fire and explosion insurance, and mandatory insurance for construction activities. It takes effect from 1 July 2026.
Insured Subjects and Minimum Sum Insured (Articles 1, 2)
- Project owners must buy mandatory construction-period insurance for: projects with major impact on safety or public interest; projects with high environmental risk; and large-scale, technically complex projects.
- The minimum sum insured is the full completed value of the project (materials, labor, equipment, freight, taxes, fees, etc.) and must not be lower than the total construction contract value. If the project value changes, the policyholder must notify the insurer within 5 working days.
Exclusions (Article 3)
Adds exclusions for losses from decay occurring under normal pressure and temperature, and losses from hard scale formation (rust, sediment, and similar phenomena).
New Premium Schedule and Deductibles (Article 4, Appendix III)
Appendix III is reissued in full, with two premium groups:
- Projects with no or limited equipment-installation work (under 50% of value).
- Projects where equipment installation makes up 50% or more of value.
Each group sets premium rates (per mille of project value) and deductible categories (type M or N) by project type: civil works (housing, education, healthcare, sports, culture, commerce, services, offices), industrial works (building materials, metallurgy, mining, oil and gas, energy, chemicals, light industry), technical infrastructure (water supply and drainage, waste treatment, telecommunications), transport works (roads, railways, bridges, tunnels, ports, airports, cable cars), and agriculture and environment works (irrigation, dykes).
Insurers may adjust premiums up or down by a maximum of 25% based on risk assessment, but must maintain a documented underwriting and assessment process, confirmed by an actuary and audited internally every year. Insurers may not discount below the set rates for: projects in areas at risk of flash floods, landslides, or subsidence; or insurers that have posted a loss on their property insurance line for three consecutive financial years. For nuclear power plants and projects not otherwise listed, premiums are negotiated between the parties based on confirmation from the lead foreign reinsurer.
Responsibility to Purchase Insurance (Article 5)
The project owner bears primary responsibility and may delegate purchasing to a contractor but must still monitor and supervise. If insurance is purchased by item, the combined sum insured across items must not be lower than the minimum sum insured for the whole project.
Extended Construction or Warranty Periods (Articles 6, 7)
If the construction or warranty period runs longer than originally planned, the policyholder and insurer must agree on an additional premium for the extended period. Survey, design, and construction contractors must supply project-value information so the corresponding premium can be determined.
Replaced Appendices and Terminology (Articles 8, 9)
Appendix III and Form 3 of Appendix X of Decree 67/2023/ND-CP are replaced. The phrase 'third person' is replaced with 'third party'; 'construction investment activities' is replaced with 'construction activities'; and references to construction-consultancy professional liability insurance are updated throughout Decree 67/2023/ND-CP.
Effective Date (Article 10)
The decree takes effect from 1 July 2026. Insurance contracts signed before the effective date and still valid continue under their original terms, unless both parties agree to amend them under the new rules. Government-guaranteed projects with legal stability clauses follow the terms of their guarantee agreement.