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Merchant Shipping (Local Vessels) (Amount of Insurance Cover) Notice – New compulsory insurance requirements
This article is a friendly reminder about the implementation of the new compulsory insurance requirements of the Merchant Shipping (Local Vessels) (Amount of Insurance Cover) Notice ("Notice").
The new requirements were effected from 2 Jan 2007 and implemented in two phases. In the first phase (i.e. the first 6 months from the commencement of the Notice), the amount of insurance cover is the same as the amount prescribed under the existing Merchant Shipping (Compulsory Third Party Risks Insurance) Regulation, i.e. HK$3 million for existing launches or ferry vessels, or their equivalent classes and types of vessels under the Merchant Shipping (Local Vessels) Ordinance (Cap. 548) ("LVO"), and HK$600,000 for existing pleasure vessels or their equivalent classes and types of vessels under the LVO.
In the second phase, (i.e. 6 months after the commencement of the Notice), the amount will be adjusted to:
- HK$5 million for a vessel permitted to carry more than 12 passengers, other than a Class I primitive vessel (i.e. Kaitoo) or a Class IV vessel not let for hire or reward.
- HK$1 million for a vessel permitted to carry 12 or less than 12 passengers, a Class I primitive vessel or a Class IV vessel not let for hire or reward.
Also, in the second phase, Mainland or Macau non-convention vessels entering or remaining in Hong Kong waters will be required to have a policy of insurance or an indemnity arrangement covering HK$1 million for the use or remain of the vessels in Hong Kong waters. The policy of insurance or indemnity arrangement shall be provided by either an authorised insurer under the LVO, or an insurer or a protection and indemnity association approved by the appropriate government authority in the place of registry of the vessel. This requirement is made under sections 49 and 50 of the Merchant Shipping (Local Vessels) (General) Regulation.