Property Insurance Disputes Between Vietnamese Enterprises and Foreign Insurance Companies
In the context of international integration, many Vietnamese businesses choose to purchase insurance from foreign companies to protect valuable assets. However, when disputes arise, the claims process becomes increasingly complicated—not only due to legal entanglements but also because of differences in claims standards and dispute resolution mechanisms.
Let’s explore the “bottlenecks” and effective solutions when property insurance disputes occur between Vietnamese enterprises and foreign insurers—from legal perspectives to practical handling experience.
1. Why do property insurance disputes commonly arise in Vietnam?
1.1. Differences in interpretation and application of insurance terms
According to the Law on Insurance Business 2022 and its guiding documents, property insurance compensation in Vietnam must be based on market value at the time of loss and the actual extent of damage—unless otherwise agreed in the contract.
However, foreign insurance companies often apply international valuation or damage assessment standards, which may differ significantly and easily lead to disputes during claim processing.
1.2. Court realities and updated statistics
In 2024 alone, there were 39 insurance disputes brought to court in Vietnam, in which insurers lost 35 cases, with total compensation exceeding VND 40 billion. This reflects both the frequency and severity of insurance disputes, including property insurance.
1.3. Unresolved internal complaints
Many disputes arise because insurers delay file processing, deny compensation, or fail to follow the assessment procedures and insurance conditions properly—especially when Vietnamese enterprises lack sufficient evidence or complete notification procedures.
2. Effective dispute resolution mechanisms in Vietnam
2.1. Negotiation – Mediation: tactful and time-saving
If the contract contains flexible dispute resolution clauses, Vietnamese enterprises and foreign insurers may prioritize negotiation or mediation to maintain the relationship and resolve issues quickly.
2.2. Commercial arbitration: fast, confidential, and international
Where agreed upon in the contract, disputes may be referred to international arbitration institutions—such as in Singapore, London, or New York. This method offers:
Simplified procedures and faster timelines
Confidential hearings that protect sensitive information
Binding and enforceable arbitral awards
2.3. Vietnamese courts – When enforcement power is prioritized
If no dispute resolution method is specified in the contract, businesses may file a lawsuit at a Vietnamese People’s Court, as stipulated in Article 32 of the 2022 Insurance Business Law.
Vietnamese courts handle insurance disputes within a clear legal framework and possess the authority to enforce judgments—suitable when negotiation or arbitration proves ineffective.
3. A recommended roadmap for Vietnamese enterprises facing disputes
Thoroughly review the contract:
Identify the insured event, coverage scope, arbitration or court clause, venue, and language.
Properly store the contract and all appendices.
Notify early and collect evidence:
Send notice of loss; take photographs, prepare site reports, invoices, assessment documents, etc.
Prioritize negotiation – mediation:
This “soft approach” helps preserve relationships and reduces costs and time.
If no resolution – proceed to arbitration or court:
Check for arbitration clauses—if present, proceed accordingly.
If not, file a lawsuit at the nearest competent Vietnamese People’s Court.
Pay attention to the statute of limitations:
Under Vietnamese law, businesses must file suit within 2 years from the date the dispute arises; otherwise, they may forfeit their right to claim compensation.
4. Practical example
In a case where a Vietnamese enterprise (referred to as Client A) purchased property insurance from Insurance Company X (foreign-based) and was denied compensation, a strategic roadmap might include:
Step 1: Draft a formal claim request, attach photographs, site reports, invoices, and loss assessments.
Step 2: Follow up with polite but firm communication via phone or email; consider mediation services or expert consultation if needed.
Step 3: If negotiation fails, invoke the arbitration clause if available. Choose a neutral third-country arbitration center—often more favorable in language and expertise.
Step 4: If there is no arbitration clause or arbitration is unsatisfactory, initiate proceedings at a Vietnamese People’s Court—such as in the district where the loss occurred or where the defendant is located.
Step 5: During litigation, request interest for late payment if the insurer delays compensation as per legal provisions.
This approach strikes a balance between tact and legal assertiveness, aligning well with practical handling of insurance disputes in Vietnam.
Conclusion
Property insurance disputes between Vietnamese enterprises and foreign insurers can be complex—but entirely manageable when businesses are well-prepared with contracts, evidence, and a clear legal strategy that leverages Vietnam’s legal framework.
If you—Client A—are facing an international property insurance dispute, prioritize your rights. Contact professional insurance lawyers in Vietnam to receive strategic, tailored advice:
Draft compliant and complete claims requests
Evaluate negotiation, arbitration, or litigation paths
Receive support through the full process—from evidence to judgment enforcement
DEDICA Law Firm is your trusted partner—from document preparation, negotiation, and arbitration to litigation—committed to maximizing the protection of your legal rights and interests.
Contact DEDICA Law Firm for expert legal consultation!
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