It is compulsory for household property owners to get fire insurance coverage for their properties, Consumer Council therefore recently conducted a survey on fire insurance services provided by banks and insurance companies for consumers' reference.
According to the 'Guideline on Residential Mortgage Loans', institutions should take out insurance (e.g. fire insurance) for the collateral properties naming themselves as the beneficiary, irrespective of whether the cost of insurance is to be borne by the borrowers. The usual practice now is that the borrowers are requested by banks to get fire insurance to cover the structure of their properties.
Household property nowadays costs at least several million dollars and the fire insurance premiums involved amount to several thousands. Consumers are therefore concerned about the calculation of these premiums.
Result of the mentioned survey shows that it is generally accepted by banks for property owners to purchase fire insurance coverage from insurance companies, and the requested insured amount should equal to, or not less than the mortgage amount; certain banks also ask for an extra percentage based on the amount of mortgage as the insured amount. For insurance companies, each company requires different insured amount and the standards involved are much complicated than those of banks.
Survey result also reveals that almost 50 percent of the surveyed banks and some insurance companies allow justifications of insurance premiums according to reduction of the mortgage amount, such application should be made by the policyholder to the bank or insurance company in written format and approval from banks is necessary for insurance companies. Details of the survey can be found in issue no. 232 of Consumer Report.
The current issue also features the result of a test on bottled water co-held by Consumer Council and Civic and Municipal Affairs Bureau (IACM). Consumer Report is now available free of charge at the office of Consumer Council (Rua Inácio Baptista, Nº 6-6A Edficio Seaview Garden R/C), and the service counter of Consumer Council at Macao SAR Government Service Centre (Rua Nova da Areia Preta, Nº52), Public Information Centre at Vicky Plaza, libraries and bookstores. Consumers may also access the resources online on the Council's official website (http://www.consumer.gov.mo). For enquiries, please call 8988 9315.
