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The Building Management (Third Party Risks Insurance) Regulation (the Regulation), which was made by the Chief Executive in Council on June 26, 2007, is published in the Government Gazette today (July 6).
Section 12 of the Building Management (Amendment) Ordinance 2000 (which has yet to commence) 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 can be downloaded from the website (www.buildingmgt.gov.hk).
"While OCs may have dutifully performed their duties of managing and maintaining their buildings properly, accidents may still happen in the common parts of a building, causing bodily injury or in the most unfortunate event, death of a third party. The civil liability of OC and its owners could be huge 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 policy for OCs shall provide insurance of not less than $10 million in respect of any liability that may be incurred in respect of the death, or the bodily injury, or both of a third party, arising out of one event. It is not a mandatory requirement for the third party risks insurance policy of OCs to cover any liability arising out of a breach of duty imposed by law in relation to unauthorised building works."
The regulation will be tabled at the Legislative Council for negative vetting on July 11.
"To enable the OCs and the property management companies to familiarise themselves with the new requirements and to arrange for procurement of third party risks insurance for their buildings, it is our plan that the requirement for compulsory insurance for all OCs shall commence on January 1, 2009. We strongly advise all those buildings 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/Friday, July 6, 2007
Issued at HKT 11:00
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