What kinds of liability insurance are compulsory in China?
What are the types of Liability Insurance in China?
The main types of Liability Insurance in China are Public Liability, Product Liability, Employer’s Liability, Professional Liability, Directors and Officer Liability, Production Liability, School Liability, and Medical Malpractice Insurance.
First of all, Public Liability is the most common and most basic liability that a company must have with respect to injury or damage to property belonging to third party.
The second is Employer’s Liability, which it covers the liability of the company following a labour accident to the staff.
Third is Product liability covers the liability of the company for products to manufacture or sell to third parties.
The fourth one is the Professional Indemnity, which it covers the liability of a company regarding errors and omissions occurring when providing services.
Directors and Officer Liability covers liability of the senior managers of the company in their position as manager, such as the General Manager, the Chief Financial Officer and sometimes HR as well.
School Liability is a special form of liability insurance in China taken out by schools. It covers any accident to pupils or students during school activities.
The last one is Medical Malpractice. So, it covers any bodily injury or financial loss to a third party resulting from negligence for hospitals when providing medical services.
What does General Liability Insurance not cover?
General Liability insurance in China does not always cover Expected Intended Injury, Aircraft and Watercraft Liability, War, Damage to your product, Damage to impair property, Asbestos, Professional Liability, Fines and Penalties as well. Additionally, contractual liability, Food & Drink, Pollution, Damage to the property and custody, Damage to the property rent, Product Recall are also excluded by can be carved back.
Are there any government obligations for Liability Insurance in China?
Yes, there are some compulsory liability insurances in China. The first one, like everywhere in the world, is Motor and Third-Party Liability. In Shanghai and Beijing, as far as I know, Safety Food Liability is compulsory and so it covers any bodily injury following the consumption of food or drink. Another is liability for travel agents; in China all the travel agencies must buy Liability Insurance. Safety and Production Liability Insurance is compulsory mainly for manufacturers and this is usually taken out locally, meaning a company must buy this through the company managing the industrial park.