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The Legislative Council passed a resolution to amend the Building Management (Third Party Risks Insurance) Regulation (the Regulation) moved by the Secretary for Home Affairs today (November 7). The resolution will be published in the Government Gazette on November 9, 2007.
The new section 28 (which has yet to commence) of the Building Management Ordinance as amended by the Building Management (Amendment) Ordinance 2007 requires all owners' corporations (OCs) to procure and keep in force in relation to the common parts of the building a policy of third party risks insurance. The Regulation sets out the detailed requirements for OCs to procure third party risks insurance. The Regulation could be downloaded from our website (www.buildingmgt.gov.hk) from November 9, 2007.
"Whilst OCs may have dutifully performed their duties to manage and maintain their buildings properly, accidents could still occur in the common parts of a building, causing bodily injury to, or the death of, a third party. The civil liability of an OC and its owners could be heavy in financial terms. Requiring all OCs to procure third party risks insurance will ensure better protection of the interests of the owners, as well as the third parties concerned," a spokesman for the Home Affairs Department said.
"Under the Regulation, the minimum insured amount of each policy shall be not less than $10 million per event. As unauthorised building works are illegal works which owners should remove as a matter of priority, the Regulation does not mandate that an OC should take out a third party risks insurance policy to cover any liability arising out of a breach of duty imposed by law in relation to unauthorised building works."
"In order to give the OCs and the property management companies sufficient time to familiarise themselves with the new requirements and to arrange for procurement of third party risks insurance for their buildings, we aim to stipulate that the requirement for compulsory insurance for all OCs should take effect on January 1, 2009. We strongly advise all those OCs which have yet to procure insurance should do so as quickly as possible to ensure the best protection of the interests of the owners and third parties," the spokesman said.
Ends/Wednesday, November 7, 2007
Issued at HKT 15:40
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