Product liability insurance is not paid enough attention

Playing role in sharing risk with manufacturers and supporting consumer, product liability insurance is considered an indispensable element of many developed countries. However, this type of insurance is not paid enough attention in Vietnam.

Product liability is not a concern

According to Phung Dac Loc, Secretary General of the Vietnam Insurance Association, responsible for the product for the producers, business people in Vietnam have not been mentioned much, though the Civil Code had prescribed.

For example, in cases of food poisoning in Nha Trang, making 60 traveler must go to the emergency and their trip was canceled. Worthy, the responsibility of the restaurant's products must fully compensate travel, the cost of treatment and personal income for people poisoned during hospitalization. However, product liability of restaurants in Vietnam are not mentioned. Or 2006, in Da Nang, a small child playing carousel crashed to the ground dead, then a new public opinion was shocked to question the responsibility for organizing various entertainment.

Not only domestic merchandise that even Vietnam's exports could not avoid this situation. Pangasius, frozen shrimp antibiotic residues too big when exported to Japan was forced destruction. Or as bottled mineral water for export to Australia was returned because the order detecting domestic hair ... So apart from compensation for breach of contract, Vietnam must now bear the full cost of wharves, warehouses during shipment is awaiting customs procedures in the host country and the shipping costs.

Product liability in the countries of the world has long been interested and very tight handling. There have been many manufacturers, the business must compensate for high levels because of forgotten or guidelines recommended for use on product packaging. 555 tobacco Department must compensate hundreds of billions worth because not recommend lung cancer harm to users is one lesson to heart not only for the tobacco company in particular but also the experience blood for manufacturers, business and other products.

These ideas will be the lesson, is the warning bell on product liability for the production and trading. However, product liability insurance has not received the attention worthy destination. Most businesses do not buy insurance Vietnam product liability if it is not in the contract commitments. This type of insurance is purchased in case Vietnam now working with foreign partners. Currently, the Vietnam insurance companies and insurance companies invested abroad still receive product liability insurance. Some domestic insurers have links with foreign insurers other to perform litigation ...

Need to increase the level of sanction

Currently, consumers have interest but sanitary condition but no products struggle a meaningful way. Therefore, manufacturers increasingly disregarded the safety factor products, this situation lasts long and increasingly serious consequences.

Besides, Vietnam enterprises also not interested in the international practice. For example, a chair by Vietnam produce stand just sitting largest gravity is 80 kg, however, so not recommended, so as to export to foreign markets, the 100 kg sitting on a broken chair made and people with spinal cord injuries. Certainly, in this case, now Vietnam will have to bear all the compensation without liability insurance products.

Although the Civil Code stipulates liability products, but the sanction was too light, only administrative sanctions warning identifiable with several million should not be effective.

Meanwhile, at present, in Vietnam, the authorities protect the interests of consumers are not much. Volume was meager, hardly operational status salty, so, product liability is far from desirable. To remedy this situation, the government and state authorities on product safety and product quality to be really involved. Governments should have the decree guiding the Civil Code. The authorities need to manage more closely, bar regular inspections, continuous production facilities of goods, especially food safety

Why consumers have to protect themselve?

Consumer rights are being seriously violated in many forms and in many areas, while the Law on Protection of consumer rights is still limited and not come to life. For example, many companies and organizations running businesses on goods which may cause damage to human life and health, animals and plants hesitate buying product liability insurance.

Widespread violation

Law on Protection of consumer rights with effect from the date 1-7-2011 assert consumer rights are respected and protected in accordance with law. State and society have the responsibility to make timely, fair, transparent and lawful to protect the interests of consumers.

However, according to the jurists, law enforcement remains limited. The business organization is not interested in the provisions of law applicable to their responsibilities in providing information on goods and services or to explain clearly the trading conditions for consumers when signing contract. The base units and agencies tasked to help the MPC perform state management functions on protection of consumer rights is still much confusion, inadequacy, the propaganda of the law is not strong, the lack of inter continue. This weakness leads to real-time status of goods, counterfeiting and Piracy, shoddy goods and commercial fraud events increasingly sophisticated.

Of the more than 150 complaints sent to the Association for the Protection of consumer rights in many industries City restaurant and various services, most of the complaints of consumers arising from breach of the Law on Protection of human rights Consumers, not just individuals, business organizations, but also consumers are violated due to lack of understanding of the law. Many issues related to the law is completely overlooked as the business unit does not provide vouchers, while sales invoice; controlling contract form and general trading conditions are quite strict rules but the fact still not been implemented ultimately ... For this reason, the settlement of the complaint is not effective.

Need evaluation agency product quality

Concerning the evaluation of commodity issues, recently occurred disputes between consumers and companies selling gold in Diamond Plaza Trade Center on several dozen items of gold jewelery and precious stones worth up to 500 million. The case has been steering clear, many departments have a meeting but has no regulatory authority to deal with while still challenging business customers, not to attend the mediation of the Assembly.

One of the advantages of the Law on Protection of Consumer Rights is to create favorable conditions for the consumer may exercise the right to sue to defend their rights, but so far consumers have no legal conditions Management to implement by the inadequacies, lack of uniformity in the legislation. There have been many cases of consumers to buy low-quality goods but they did not know how to handle, thanks to public bodies or spontaneous reactions style so often fall into bad state.

To promote efficiency law, lawyer Nguyen Van Hau, Vice Chairman of HCMC Bar Association said that the need to provide transparency for the legal protection of consumers, the rules must be clear about the picture form and content in order to protect the interests of consumers. The sanctions, sanctions against counterfeiting, shoddy goods have not created the rule. It should be mandatory for private organizations dealing in goods which may cause damage to the life and health of human, animals and plants must buy product liability insurance.

After 2 years of implementation of the Law on Protection of consumer rights will certainly have to adjust, modify suit the actual circumstances. Initially, only the enthusiasm, dedication and perseverance in law enforcement, consumer interests are also common interests of each agency, organization or individual in society, the protection new consumer rights have practical effects. In the context of future products, counterfeiting, contraband ... rampant as today, the close collaboration of the stitching, the consumer unit and working together is the most practical to create strong social pressure for protect consumer interests.

Product liability insurance and concerns

Although there are many manufacturers want to buy product liability insurance in order to increase confidence for customers - an effective marketing tool for them. However, few companies can afford product liability insurance and few insurance companies have the courage to offer this product.

Revenue from product liability insurance is still very modest, only about 1% of total revenue, which is the result of a survey at some enterprises have deployed products. Across the market, but no adequate statistics, but a whole array of general liability insurance accounts for only about 2% of the total premium of the market for non-life insurance and compensation percentage is below 10%, Exceptions have an insurance company under the top are the percentage of compensation up to 84% in the first quarter / 2014.

Talk about paradoxes for more supply for product liability insurance, represent an insurance company said the non-life insurance product liability is a fairly complex product in terms of the fees and compensation often. People specialized product called it "long-tail" (long tail) since the inception of customer events can occur long after they buy the product. Meanwhile, insurance companies still have to be responsible, therefore, the risk is very high.

As insurance for products of many large enterprises such as Shell Gas, Big C and Lotte Mart, Insurance Vietnamese representative said that in recent years, the sense of responsibility to buy insurance products were also popular more variable for the manufacturing enterprise and supply products in countries where there is risk of damage to third parties such as gas processing, pharmaceutical, cosmetics ...

However, the representative also confirmed that popular type of insurance in developed countries due to mandatory provisions of law, by the consciousness and the demand from major consumer of products and important Advanced most sense responsible for the supplier's products, but this is a complex type of coverage may be related due to the legal provisions on consumer protection not only in Vietnam but there may be countries where the product is consumed. Therefore, this type of coverage should be provided by large insurance companies have the capacity and experience in the insurance market of Vietnam.

Reportedly, customers purchasing liability insurance type products now mainly foreign enterprises and enterprises with foreign investment or trading firms with international market conditions for buyers Product liability insurance is mandatory in commercial contracts. However, the number of domestic manufacturing enterprises are interested in this type of insurance is also increasing, so buy product liability insurance in addition to bringing peace of mind to customers, this is a effective marketing strategy.

Although there is currently no insurance companies involved in the deployment of this type of coverage (only a few of the non-life insurers in the group market leader and foreign insurance companies), but in the future , with product demand increased strongly, the smaller insurers will certainly be seeking to enhance their competitiveness to advance to the "playground" is.

Of course, between theory and reality has always been a long road, but in the economic context more difficult, demand for property insurance, marine ... down, the product liability insurance may is an attractive segment Other. Moreover, after the economic crisis, the non-life insurance sector is in the restructuring phase of insurance products, changing direction, instead of just focusing on premium products generate higher revenues but customers increasingly diminished as difficult.

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