A new subsidy has been introduced to owners of buildings that have completed comprehensive rehabilitation works under the Urban Renewal Authority's voluntary schemes to help them secure public liability insurance.

It is estimated about 50 such buildings will be eligible to apply for the new subsidy annually.

The authority's Planning, Development & Conservation Committee Chairman Professor David Lung said there has been widespread concern among property owners about their liability for neglecting building management and maintenance following a recent court case involving Albert House in Aberdeen, in which all owners had to jointly shoulder the burden of a $25 million compensation in a fatal building accident.

A recent opinion survey, covering owners' corporations of 144 buildings, found owners have been shocked by the Albert House case and will like to either take out insurance cover or raise their existing insurance amounts.

About 21% of them have not yet acquired the protection of public liability insurance while 62% of those already insured wish to raise their coverage. All owners' corporations that have not yet acquired public liability insurance said they would do so if subsidised by the authority. Among those already insured, 90% said they would want to raise their coverage if assisted by a subsidy.

New subsidy

Professor Lung said a new subsidy was then introduced to help them acquire public liability insurance or raise their existing cover to a sufficient level.

Apart from protection from public liability claims, an adequate public liability insurance cover will also have the benefit of encouraging the banks to approve more confidently home mortgage loans for the owners or potential buyers of flats in rehabilitated buildings, he said.

Authority District Development Director Stephen Lam said any owners' corporation that has successfully completed comprehensive rehabilitation works under the authority's building rehabilitation schemes will be reimbursed 50% of the insurance premium for three consecutive years, up to a maximum of $6,000 a year.

Owners' corporations have to apply to the authority before taking out public liability insurance for its building with an insurance company under the Government's approved list.

Applications for subsidy reimbursement should be submitted within 12 months upon completion of the rehabilitation works, he said. For details and enquiries, call the authority's hotline 2588 2333.