Tourist buses and commercial vehicle operators crossing over the Cambodia-Vietnam border will soon be required by law to have insurance in both countries or risk being denied entry, a bilateral agreement signed on Tuesday states.

In an effort to meet requirements stipulated in the ASEAN 2015 integration plan, insurance industry representatives from Cambodia and Vietnam signed a memorandum of understanding to ensure that all commercial vehicles crossing the countries’ shared border were insured.

The MoU was signed by the Cambodia Insurance Association (CIA) and Vietnam’s largest insurance provider and industry representative, Bao Viet Insurance Corporation (BIC), at the Ministry of Economy and Finance.

Until now, commercial vehicles such as trucks and tourist busses crossing the border have not been legally required to have insurance in both nations.

“Both countries now require cross-border vehicles to have insurance to cross the border, but we have different laws on auto insurance,” Chhay Rattanak, president of the CIA, told the Post yesterday.

“That is why we signed the MoU as a bilateral agreement on the issue.”

The agreement, which is set to be implemented within three months of its signing, is in line with the obligations and requirements stipulated in Protocol 5 of the Association of Southeast Asian Nation’s Scheme of Compulsory Motor Vehicle Insurance.

Commercial trucks and tourist busses will be required to be insured with both passenger liability and third-party liability cover within the next three months. Failure to meet the insurance requirements will result in the vehicle being refused border crossing, Rattanak said.

The insurance requirements will be extended to smaller passenger vehicles in the near future, he added.

Some 500 commercial trucks and tourist busses cross the Cambodia-Vietnam border every day, according to documents included in the MoU.

So Nguon, co-chair of the Energy, Infrastructure and Transport Working Group, welcomed the news; however, he called on Vietnamese insurance firms to offer affordable insurance prices to Cambodian transport companies.

“Vietnam insurance company is bias to their citizen. They sell us insurance in higher price than what they offer to their citizens which create unfair business competition,” Nguon said.

“How can we compete if they charge us more than they charge their businessmen?” he added.

Rattanak added that members of the Cambodia Insurance Pool would work with the Vietnamese insurance provider, BIC, which is partially government-owned, to promote each other’s products.

All insurance companies in the Kingdom are members of the Cambodia Insurance Pool.

The insurance pool was established in 2009 following a memorandum of understanding for cross-border travel to and from Cambodia.