The criteria for determining a reputable insurance organization in the maritime sector are outdated.

Only qualified people can participate in marine insurance.

Since 2010, the Ministry of Finance has issued Circular 219/2010/TT-BTC guiding the criteria for determining reputable insurance organizations in the maritime sector according to the provisions of the Ordinance on procedures for arresting ships.

Ship owners, charterers and ship operators have more advantages in choosing a reliable insurance company. (Illustration photo)

Accordingly, a reputable insurance company in the maritime sector must meet many criteria. First of all, the company must have a minimum charter capital of VND300 billion, ensuring strong financial capacity. Next, it is necessary to maintain a solvency margin according to legal regulations, demonstrating the ability to meet financial obligations arising from insurance activities.

In terms of organization, the enterprise must have a specialized marine insurance department, with a head having at least 3 years of experience or appropriate professional qualifications to ensure professional quality.

In addition, enterprises must establish a management system and organize an appropriate operating apparatus to ensure efficiency and compliance with the law in the field of marine insurance. In particular, enterprises are allowed to issue letters of guarantee or guarantees for arrested ships, provided that these activities must be approved by the court in accordance with current regulations.

These criteria aim to ensure that only organizations with sufficient financial capacity, expertise and reputation are allowed to participate in marine insurance, protecting the rights of relevant parties in ship arrest procedures in Vietnam.

Annually, based on the criteria, records, and supporting documents of insurance companies, the Ministry of Finance will review and publish a list of reputable insurance organizations in the maritime sector.

The application of this regulation has brought about many positive effects. On the part of state management agencies, encouraging shipping enterprises to use the services of insurance enterprises has contributed to enhancing the capacity and role of the insurance market.

For ship owners, charterers or ship operators, the publication of a list of reputable insurance organizations makes it easier for them to choose a reliable insurance company to issue a letter of commitment, thereby supporting the quick release of ships, minimizing economic losses and avoiding disruptions to maritime transport.

For insurance companies, the public listing of reputable insurance organizations in the maritime sector helps them easily access and issue letters of commitment to ensure the property obligations of ship owners, charterers or ship operators when ships are detained.

For the judiciary, this list helps the Court increase flexibility in receiving and processing requests for the arrest of ships, while minimizing liability and lawsuits for damages related to the wrongful arrest of ships.

No longer relevant to reality

However, after 15 years of application, shortcomings and limitations have emerged. Some legal bases for the issuance of Circular No. 219/2010/TT-BTC have now expired and been replaced, such as the Law on Insurance Business No. 24/2000/QH10; Decree No. 46/2007/ND-CP dated March 27, 2007 of the Government on the financial regime for insurance enterprises and insurance brokerage enterprises; Decree No. 118/2008/ND-CP dated November 27, 2008 of the Government regulating the functions, tasks, powers and organizational structure of the Ministry of Finance.

In addition, the Law on Insurance Business and its implementing documents have many new regulations related to financial and human resources issues of insurance enterprises.

Therefore, the criteria for determining reputable insurance organizations in the maritime sector according to Circular No. 219/2010/TT-BTC are no longer suitable to reality. In addition, this Circular does not specifically stipulate the time limit for notification by the Ministry of Finance as well as the validity period of the Notification, leading to many different interpretations and causing difficulties in the implementation process.

On the insurance business side, Circular 219 stipulates criteria for work experience, qualifications and training certificates of the head of the cargo insurance department or the hull insurance department, the shipowner's civil liability department or the marine insurance department. However, the law on insurance business does not specifically stipulate the names or functions of these departments.

In fact, many insurance companies do not have separate departments for cargo insurance or hull insurance and shipowners' civil liability, but only have general departments for exploitation and compensation for the entire business. Therefore, this regulation is not suitable for the actual operations of insurance companies.

For state management agencies, the regulations on experience, degrees and training certificates of heads of professional departments are not close to the actual operations of insurance enterprises, causing difficulties in determining whether the enterprise meets the criteria or not.

Source: https://baodautu.vn/tieu-chi-xac-dinh-to-chuc-bao-hiem-uy-tin-trong-linh-vuc-hang-hai-da-loi-thoi-d348942.html