Decree No. 58/2018/ND-CP dated April 18, 2018 of the Government on agricultural insurance

DECREE

On agricultural insurance^[1]

Pursuant to the June 19, 2015 Law on Organization of the Government;

Pursuant to the June 25, 2015 Law on the State Budget;

Pursuant to the December 9, 2000 Law on Insurance Business and the November 24, 2010 Law Amending and Supplementing a Number of Articles of the Law on Insurance Business;

Pursuant to the National Assembly’s Resolution No. 32/2016/ QH14 of November 23, 2016, on further raising the efficiency and effectiveness of the implementation of the national target program on building a new countryside in association with the restructuring of agriculture;

At the proposal of the Minister of Finance;

The Government promulgates the Decree on agricultural insurance.

Chapter I

GENERAL PROVISIONS

Article 1.Scope of regulation

This Decree prescribes agricultural insurance and agricultural insurance support policy to encourage insurers to provide agricultural insurance and create conditions for organizations and individuals engaged in agricultural, forestry and fisheries production to proactively overcome and compensate for financial losses caused by risks occurring in the production process.

Article 2.Subjects of application

This Decree applies to:

1. Organizations and individuals engaged in agricultural, forestry and fisheries production (below referred to as agricultural producers).

2. Non-life insurance enterprises and branches of foreign non-life insurance enterprises (below referred to as insurers) and reinsurers that are established, organized and operate under the Law on Insurance Business and relevant laws.

3. Agencies, organizations and individuals involved in the implementation of agricultural insurance and agricultural insurance support policy.

Article 3.Interpretation of terms

In this Decree, the terms below are construed as follows:

1. Agricultural insurance buyer means an organization or individual that enters into an agricultural insurance contract with an insurer and pays insurance premiums. An agricultural insurance buyer may concurrently be the insured.

2. Agricultural insured (the insured) means an organization or individual having production objects in the agriculture, forestry and fishery sector insured under an agricultural insurance contract.

3. Agricultural insurance is a form of insurance for production objects in the agriculture, forestry and fisheries sector whereby an insurance buyer pays premiums and the insurer compensates the insured upon occurrence of an insured event.

4. Agricultural co-insurance means the joint entry by two or more insurers into an insurance contract with an insurance buyer to insure an object of agricultural insurance with the same insurance rules, terms and premium tariffs.

5. Agricultural reinsurance means an activity of insurers or reinsurers receiving an agricultural insurance premium from another insurer in order to commit to compensating for the insured liability.

Article 4.Types of agricultural insurance

1. Insurance for an identified risk whereby, upon the occurrence of an insured event, an insurer compensates for the actual loss caused by the risks as specifically agreed upon in the agricultural insurance contract.

2. All-risk insurance whereby, upon the occurrence of an insured event, an insurer compensates for the actual loss caused by all risks, except cases of exclusion of insurance liability as agreed upon in the agricultural insurance contract.

3. Insurance for loss of income whereby, upon the occurrence of an insured event, an insurer compensates for agricultural production costs to cover losses caused by the insured risks as agreed upon in the agricultural insurance contract.

4. Productivity index-based insurance whereby, upon the occurrence of an insured event, an insurer compensates for the actual productivity loss of a geographic area (district, commune...) as agreed upon in the agricultural insurance contract, regardless of the actual loss of the object of insurance.

5. Weather index-based insurance whereby, upon the occurrence of an insured event, an insurer compensates for changes in the weather index (rain, wind, drought, flood, cold, hail, hoarfrost, earthquake, tsunami...) as agreed upon in the agricultural insurance contract, regardless of the actual loss of the object of insurance.

6. Remote sensing index-based insurance whereby, upon the occurrence of an insured event, an insurer compensates for the variation in the remote sensing index as agreed upon in the agricultural insurance contract, regardless of the actual loss of the object of insurance.

7. Other types of agricultural insurance as agreed upon in agricultural insurance contracts.

Article 5.Principles of implementation of agricultural insurance and agricultural insurance support policy

1. Agricultural insurance shall be implemented on the principle of voluntary agreement without limitations on the insured, objects of insurance, insured risks and scope of geographical area.

2. Agricultural insurance support policy shall be implemented in conformity with the budget’s balancing capacity in each period through the provision of agricultural insurance premiums for some agricultural producers, objects of insurance, insured risks and within certain geographical areas in order to implement the social security policy and the Government’s target programs on agricultural production development.

Chapter II

PROVISIONS ON AGRICULTURAL INSURANCE

Section 1

SPECIFIC PROVISIONS ON IMPLEMENTATION OF AGRICULTURAL INSURANCE

Article 6.Agricultural insurance contracts

1. In addition to the contents stipulated in the Law on Insurance Business, an insurance buyer and an insurer shall agree in detail and clearly state in the agricultural insurance contract the following contents:

a/ Names and contact addresses of the insurer’s person and its subordinate unit responsible for settling matters arising in the performance of the agricultural insurance contract;

b/ Method of determining the insurance sum;

c/ Cases of application of compensation exemption and reduction level (if any);

d/ Loss assessment; loss assessment agency or organization; and cost of loss assessment;

dd/ Determination of insured events and grounds for compensation; cases of compensation based on the announcement or certification of natural disasters or epidemics by competent agencies or organizations; cases of index-based insurance, specific agreements on indices directly related to the loss of the objects of insurance, agencies or organizations determining the difference between the actual index and the index insured; and method of determining the amount of compensation;

e/ Forms of compensation; claim dossiers (with specific agreements on documents to be provided by the insurance buyer or the insured to the insurer); and compensation time limit;

g/ Responsibilities of the parties in the control of risks, prevention and mitigation of loss and prevention and combat of insurance frauds as prescribed in this Decree;

h/ Responsibilities of the insurance buyer and the insured in fully implementing the technical process and standards in agricultural production (if any).

2. Insurance contracts entered into between organizations and individuals eligible for agricultural insurance premium support and insurers must comply with Article 32 of this Decree.

Article 7.Agricultural co-insurance

1. Insurers are entitled to implement agricultural insurance in the form of co-insurance in order to disperse and share risks, ensure financial safety and maintain a healthy competitive environment.

2. In case of implementation of agricultural co-insurance:

a/ An agricultural insurance contract must clearly state the name and percentage of co-insurance of each insurer; and the name of the insurer acting as the focal point for the performance of the contract. Insurers shall bear joint responsibility for the commitments in the insurance contract with the insurance buyer;

b/ The insurer acting as the focal point shall carry out procedures related to the entry into the insurance contract and, on behalf of other insurers, settle arising matters related to the performance of the contract.

Article 8.Agricultural reinsurance

1. In case of domestic reinsurance, an enterprise undertaking reinsurance shall ensure that:

a/ It meets the capital and solvency margin requirements, and complies with the provisions on reinsurance in the Law on Insurance Business and guiding documents;

b/ It has safe and effective agricultural reinsurance programs in compliance with law.

2. In case of offshore reinsurance, insurers shall comply with the law on offshore reinsurance.

Article 9.Compensation under agricultural insurance

1. When an insured event occurs, an insurer shall settle the compensation as agreed upon in the agricultural insurance contract and as prescribed by law.

2. The amount of compensation payable by an insurer to the insured shall be determined on the basis of the market price of the object of insurance at the time and place of occurrence of the loss and the extent of actual loss, unless otherwise agreed upon in the insurance contract. In case of index-based insurance, the insurer shall pay compensation to the insured based on the change of the actual index against the index agreed upon in the insurance contract and prescribed by law.

3. The amount of compensation paid by an insurer to the insured must not exceed the insurance sum, unless otherwise agreed upon in the insurance contract.

Article 10.Dispute settlement

1. Disputes arising in the performance of an agricultural insurance contract shall first be settled through negotiation as agreed upon in the contract and prescribed in the Law on Insurance Business and relevant laws.

2. In case a dispute cannot be settled through negotiation, the involved parties may bring the case to a competent court in Vietnam for settlement in accordance with law.

Article 11.Agricultural insurance rules, terms and premium tariffs

1. Insurers shall take the initiative in formulating agricultural insurance rules, terms and premium tariffs, ensuring compliance with the Law on Insurance Business and relevant laws, and notify them in writing to the Ministry of Finance prior to implementation.

2. In case of implementation of the agricultural insurance support policy, insurers must have their agricultural insurance rules, terms and premium tariffs approved by the Ministry of Finance prior to implementation. The dossiers, order and procedures for approval of agricultural insurance products must comply with Article 33 of this Decree.

Article 12.Responsibilities of insurers in the entry into and performance of agricultural insurance contracts

1. To explain and provide full information relating to insurance contracts, rules, terms and premium tariffs for insurance buyers. To enter into agricultural insurance contracts only when insurance buyers fully understand the contents related to the agricultural insurance contracts, rules, terms and premium tariffs.

2. To enter into agricultural insurance contracts on the principles of voluntariness, autonomy and self-responsibility; to ensure the principle of the majority compensating for the minority and take the initiative in dispersing and sharing risks through co-insurance and reinsurance.

3. To take the initiative in controlling risks, preventing and limiting losses and preventing and combating insurance frauds under Section 2, Chapter II of this Decree.

4. When an insured event occurs, to promptly send staffs to approach the object of insurance and instruct the insured to take measures to limit the loss (if any). To pay necessary and reasonable expenses to limit the loss.

5. To organize loss assessment to identify the cause and extent of loss in a public and transparent manner as agreed upon in the agricultural insurance contract and prescribed by law. In case of index-based insurance, to collect announcements and certifications of related authorities on the insured event (if it is so agreed upon in the insurance contract); to organize the determination of the difference between the actual index and the insured index as agreed upon in the insurance contract.

6. If determining that the loss falls under its compensation responsibility, to send its staffs to instruct the insured to prepare and provide dossiers and documents for compensation.

7. To fully pay amounts of compensation to the insured as agreed upon in the agricultural insurance contract and prescribed by law.

8. To perform other responsibilities as agreed upon in the agricultural insurance contract and prescribed by law.

Article 13.Responsibilities of insurance buyers and the insured in the entry into and performance of agricultural insurance contracts

1. To ensure that there is an insurable interest in the object of insurance as prescribed by law.

2. To provide sufficient and truthful information about to the object of insurance (including cases where the object of insurance is damaged) to the insurer.

3. To enter into an agricultural insurance contract after having fully understood the information relating to insurance contracts, rules, terms and premium tariffs provided and explained by the insurer.

4. To take the initiative in controlling risks, preventing and limiting losses and preventing and combating insurance frauds under Section 2, Chapter II of
this Decree.

5. To create conditions for the insurer to check the conditions to ensure safety for the object of insurance.

6. To promptly notify the insurer of the occurrence of insured events; to take measures as instructed by the insurer to limit losses.

7. To closely coordinate with the insurer in the loss assessment to identify the cause and extent of loss and settle compensation.

8. To perform other responsibilities as agreed upon in the agricultural insurance contract and prescribed by law.

Section 2

CONTROL OF RISKS, PREVENTION AND LIMITATION OF LOSSES AND PREVENTION AND COMBAT OF INSURANCE FRAUDS

Article 14.Responsibility in controlling risks, preventing and limiting losses and preventing and combating insurance frauds

Insurers, insurance buyers, the insured and related agencies have the responsibility to control risks, prevent and limit losses and prevent and combat insurance frauds when implementing agricultural insurance and agricultural insurance support policy in accordance with Articles 15, 16 and 17 of this Decree.

Article 15.Risk control

1. Risk control in agricultural insurance is the process of identifying, assessing, supervising and managing potential risks that may have a negative impact on the implementation of agricultural insurance and agricultural insurance support policy.

2. Insurers have the responsibility:

a/ To work out, and organize the implementation of, risk control measures and process, which specify the specific responsibilities of each individual or division in the implementation of the risk control process;

b/ To annually review and re-evaluate, and ensure the effectiveness of, risk control measures and process.

3. Insurance buyers and the insured shall take the initiative in applying risk control measures and process applicable to the object of insurance in agricultural production activities, including fully implementing regulations on animal epidemic prevention and control, plant protection and quarantine, and environmental protection; technical regulations on agricultural production promulgated by competent agencies and other relevant laws in order to ensure safety for the object of insurance.

4. Related agencies shall organize, and supervise and guide agricultural producers in, the control of risks in agricultural production activities; and organize public information on the control of risks in agricultural production.

Article 16.Prevention and limitation of losses

1. Prevention and limitation of losses in agricultural insurance means the application of measures to avoid and limit losses that may occur to the object of insurance.

2. Prevention and limitation of losses is first of all the responsibility of insurance buyers and the insured. Insurance buyers and the insured shall take the initiative in preventing, responding to and overcoming consequences of natural disasters; and preventing and controlling epidemics and overcoming damage caused by epidemics in accordance with law. They shall immediately notify the insurer of the occurrence of an insured event; and apply measures to prevent and limit losses according to the guidance of the insurer (if any).

3. Insurers shall prevent and limit losses in agricultural insurance according to the following provisions:

a/ Measures to prevent and limit losses include:

- Organizing training, propaganda and education; supporting the training in and propaganda on the agricultural insurance support policy of the local administration;

- Financing and supporting means and materials to prevent and limit risks;

- Assisting in the construction of works for the purpose of preventing and mitigating the degree of risk to the objects of insurance;

- Hiring other organizations and individuals to supervise, prevent and limit losses.

b/ Insurers may spend up to 10% of the collected agriculture insurance premiums to cover expenses for the measures for prevention and limitation of losses prescribed at Point a of this Clause.

4. Related agencies shall guide the implementation of measures to prevent and limit losses in agricultural production, including monitoring, early detection and notification of animal epidemics. animal epidemic forecasting and warning; providing guidance on measures to prevent and control animal epidemics; organizing the fight against epidemics, and taking measures to protect production when plant pests occur; directing the implementation of measures to quickly control and stamp out epidemics; organizing natural disaster response and consequence overcoming activities; and organizing propaganda on the prevention and limitation of losses in agricultural production.

Article 17.Prevention and combat of insurance frauds

1. Prevention and combat of agricultural insurance frauds means the implementation of measures to prevent and restrict fraudulent acts committed in the process of entering into or performing agricultural insurance contracts in order to appropriate money from the insurer.

2. Insurers shall take the initiative in working out, and organizing the implementation of, measures to prevent, detect and minimize acts of insurance fraud; and organize propaganda on insurance fraud prevention and combat.

3. Insurance buyers and the insured shall take the initiative in participating in the prevention and combat of insurance frauds. In case of detecting acts of insurance fraud, they shall promptly notify insurers and competent agencies.

4. Related agencies shall coordinate with insurers, insurance buyers and the insured in organizing the prevention and combat of insurance frauds in their respective localities, ensuring social order and stability during the implementation of agricultural insurance and agricultural insurance support policy.

Chapter III

AGRICULTURAL INSURANCE SUPPORT POLICY

Article 18.Objects of insurance eligible for support

1. Crops: rice, rubber, pepper, cashew, coffee, fruit trees and vegetables.

2. Livestock: buffaloes, cows, pigs and poultry.

3. Aquatic animals: black tiger shrimps, white-leg shrimps and pangasius cat fish.

Article 19.Support levels

1. Individuals engaged in agricultural production who are from poor or near-poor households are entitled to support of up to 90% of agricultural insurance premiums.

2. Individuals engaged in agricultural production who are not from poor or near-poor households are entitled to support of up to 20% of agricultural insurance premiums.

3. Organization engaged in agricultural production in the form of cooperative, associated, concentrated or large-scale production with the application of advanced science and technology and production processes to production toward a clean, hi-tech and environment-friendly agriculture are entitled to support of up to 20% of agricultural insurance premiums.

Article 20.Insured risks eligible for support

1. Natural disaster risks, including:

Storm, tropical low pressure, cyclone, lightning, heavy rain, flood, flash flood, inundation, landslide due to rain or water current, land subsidence due to rain or water current, water level rise, saltwater intrusion, hot spell, drought, cold, hail, hoarfrost, earthquake and tsunami. Natural disasters shall be announced or certified by a competent state agency.

2. Epidemic risks, including:

a/ Animal epidemics:

- Terrestrial animal epidemics: infectious diseases of terrestrial animals according to the list of animal diseases subject to epidemic declaration (including dangerous infectious diseases causing great socio-economic damage and dangerous infectious diseases between humans and animals), issued by a competent authority under the law on animal health;

- Aquatic animal epidemics: diseases of aquatic animals according to the list of diseases subject to epidemic declaration, issued by a competent agency under the law on animal health.

b/ Plant pests: organisms that harm plants and are likely to spread rapidly on a large scale, causing serious damage to plants according to the law on plant protection and quarantine.

Epidemics shall be announced or certified by a competent state agency.

Article 21.Geographical areas eligible for support

1. Provinces and centrally run cities eligible for agricultural insurance premium support are those in the main production regions according to the orientations of the agricultural restructuring and agricultural development master plan. The Prime Minister shall decide on the list of provinces and centrally run cities which are eligible for agricultural insurance premium support prescribed in Clause 1, Article 22 of this Decree.

2. For each province or centrally run city, support can be provided in the whole province or city or in some districts and communes. Based on the Prime Minister’s decisions on the objects, types of plants, livestock and aquaculture, and types of insured risks eligible for support, the People’s Committees of the provinces and centrally run cities eligible for support shall select and publicize areas eligible for agricultural insurance premium support in the local mass media and notify them in writing to the Ministry of Finance and Ministry of Agriculture and Rural Development.

Article 22.Implementation of agricultural insurance support policy in each period

1. Pursuant to Articles 18, 19 and 20, and Clause 1, Article 21, of this Decree and based on the budget’s balancing capacity in each period, the Prime Minister shall issue specific decisions on agricultural producers, types of plants, livestock and aquaculture and types of insured risks that are eligible for support; support levels; time of support; areas eligible for support; and the level of support from the central budget to the local budget for agricultural insurance premiums.

2. Agricultural producers shall be provided with agricultural insurance premium support when they fully meet the following conditions: They are organizations or individuals eligible for agricultural insurance premium support, have objects of insurance, buy insurance for insured risks under the Prime Minister’s decisions referred to in Clause 1 of this Article and are located in the geographical area eligible for support according to the announcements of the People’s Committees of the provinces or centrally run cities defined in Clause 2, Article 21 of this Decree.

Article 23.Funding sources for support

1. Funds for support of agricultural insurance premiums shall be covered by the central budget and local budgets and included in the annual state budget estimates.

2. The level of support from the central budget to local budgets for the provision of agricultural insurance premium support must comply with the regulations on the principle of targeted support from the central budget to the local budgets for implementation of social security policies.

Article 24.Dossier, order and procedures for approving support beneficiaries

1. A dossier of request for approval of a support beneficiary must comprise:

a/ A written request for consideration and approval of a support beneficiary, made according to Form No. 01 in the Appendix to this Decree;

b/ A list of plants, animals and aquaculture, made according to Form No. 02 in the Appendix to this Decree;

c/ Documents proving the eligibility for agricultural insurance premium support, for agricultural production organizations requesting support.

2. Order and procedures for approving support beneficiaries

a/ Based on the Prime Minister’s decision and the announcement of the provincial-level People’s Committee on geographical areas eligible for support referred to in Clause 2, Article 21 of this Decree, an agricultural producer shall prepare a dossier of request for approval of support beneficiaries as prescribed in Clause 1 of this Article, and send it (directly or by post) to the commune-level People’s Committee of the locality where such producer carries out agricultural production;

b/ Within 15 days after receiving a complete and valid dossier as prescribed in Clause 1 of this Article, based on the decision of the Prime Minister and the announcement of the provincial-level People’s Committee on geographical areas eligible for support referred to in Clause 2, Article 21 of this Decree, the commune-level People’s Committee shall review and draw up a list of agricultural producers requesting approval of support beneficiaries, and report it to the district-level People’s Committee;

c/ Within 15 days after receiving the report of the commune-level People’s Committee, based on the decision of the Prime Minister and the announcement of the provincial-level People’s Committee on geographical areas eligible for support as prescribed in Clause 2, Article 21 of this Decree, dossiers of request for approval of support beneficiaries sent by the communal-level People’s Committee and the report of the commune-level People’s Committee, the district-level People’s Committee shall appraise and draw up a list of agricultural producers eligible for support, then send it to the provincial-level Agriculture and Rural Development Department;

d/ Within 5 working days after receiving the appraisal report from the district-level People’s Committee, based on the Prime Minister’s decision and the appraisal report of the district-level People’s Committee, the provincial-level Agriculture and Rural Development Department shall summarize and propose the provincial-level People’s Committee to issue a decision approving the list of agricultural producers eligible for agricultural insurance premium support, made according to Form No. 03 in the Appendix to this Decree. This decision shall be sent to the provincial-level Finance Department and Agriculture and Rural Development Department and related district- and commune-level People’s Committees;

dd/ Within 5 working days after the provincial-level People’s Committee issues a decision approving the list of support beneficiaries, the commune-level People’s Committee shall post up the list of agricultural producers eligible for agricultural insurance premium support at its head office, announce it in the commune’s information and communication system and send its copies to the agricultural producers at the latter’s request.

3. On a quarterly basis, the provincial-level People’s Committee shall direct the provincial-level Agriculture and Rural Development Department and People’s Committees at all levels in organizing the approval of support beneficiaries when receiving new requests for approval from agricultural producers according to the order and procedures prescribed in Clause 2 of this Article; and at the same time, review and adjust the approved list of eligible beneficiaries in case of receiving notices prescribed in Clause 4 of this Article.

4. Agricultural producers named in the decision approving the list of support beneficiaries shall check if they are no longer eligible for the support or their poor or near-poor household status is changed according to the results of annual survey and review by competent state agencies, thus leading to changes in the level of agricultural insurance premium support. Within 5 working days after becoming no longer eligible for support or from the effective date of the decisions on recognition of poor or near-poor households, agricultural producers shall send written notices, made according to Form No. 04 in the Appendix to this Decree, to the commune-level People’s Committee.

Within 10 days after the end of a month, the commune-level People’s Committee shall summarize and report to the district-level People’s Committee for summarization and sending to the provincial-level Agriculture and Rural Development Department as the basis for reviewing and adjusting the approved list of support beneficiaries according to Clause 3 of this Article and appraise the dossiers of request for payment of agricultural insurance premium supports according to Point b, Clause 2, Article 26 of this Decree.

Article 25.Method of supporting agricultural insurance premiums

Insurance premium support shall be provided through insurers according to the order and procedures specified in Article 26 of this Decree when the insurance contracts have been entered into and have given rise to insurance liability.

Article 26.Dossiers, order and procedures for paying agricultural insurance premiums from the state budget

1. A dossier of request for payment of agricultural insurance premiums from the state budget shall be made by insurers, comprising:

a/ A written request for payment of agricultural insurance premiums from the state budget, made according to Form No. 05 in the Appendix to this Decree;

b/ A list (enclosed with the copies) of the agricultural insurance contracts the insurer has signed with agricultural producers, made according to Form No. 06 in the Appendix to this Decree.

2. Order and procedures for paying agricultural insurance premiums from the state budget

a/ Within 10 days after the end of a month, an insurer shall compile a dossier of request for payment of agricultural insurance premiums from the state budget as prescribed in Clause 1 of this Article and send it (directly or by post) to the provincial-level Agriculture and Rural Development Department;

b/ Within 10 days after receiving a complete and valid dossier as prescribed in Clause 1 of this Article, based on the decision of the Prime Minister and the decision of the provincial-level People’s Committee approving the list of support beneficiaries prescribed in Article 24 of this Decree, the provincial-level Agriculture and Rural Development Department shall assume the prime responsibility for, and coordinate with the provincial-level Finance Department in, completing the appraisal and proposing the provincial-level People’s Committee to issue a decision on payment of agricultural insurance premiums from the central budget and local budget. In case of refusal to pay, the provincial-level Agriculture and Rural Development Department shall notify such in writing to the insurer, clearly stating the reason;

c/ Within 10 days after the provincial-level People’s Committee issues the payment decision, the provincial-level Finance Department shall base itself on this decision to make a payment order to the insurer via the provincial-level State Treasury, which shall transfer money to the insurer’s account opened at a commercial bank;

d/ If failing to complete the payment to an insurer according to Point c, Clause 2 of this Article, the provincial-level People’s Committee shall direct the provincial-level Finance Department to issue a written notice to the insurer, clearly stating the reason.

Article 27.Termination of receipt of agricultural insurance premium support

1. In case of a change in policy, which leads to changes in the conditions for agricultural insurance premium support, support beneficiaries and level of support, agricultural producers will continue to enjoy the agricultural insurance premium support under the agricultural insurance contracts already entered into until the expiration of the insurance period.

2. In case of change of the poor or near-poor household status according to the results of annual survey and review by competent state agencies, thus leading to a change in the level of agricultural insurance premium support, agricultural production individuals will continue to receive the level of support for agricultural insurance premium under the agricultural insurance contracts already entered into until the expiration of the insurance period.

3. If an agricultural insurance contract terminates before the agreed time limit, an agricultural producer shall refund to the state budget the agricultural insurance premium already received from the state budget corresponding to the remaining period of the insurance contract according to Clause 4 of this Article.

4. An agricultural producer shall stop enjoying agricultural insurance premium support and refund to the state budget the agricultural insurance premium already received from the state budget for the remaining period of the insurance contract from the time:

a/ The agricultural producer no longer meets all conditions for enjoying agricultural insurance premium support prescribed in Clause 2, Article 22 of this Decree (except the case specified in Clause 1 of this Article);

b/ The agricultural insurance contract terminates ahead of time.

The agricultural producer shall refund the agricultural insurance premium already received from the state budget through the insurer according to the order and procedures prescribed in Clause 5 of this Article.

5. If no longer meeting all the conditions for enjoying agricultural insurance premium support under Point a, Clause 4 of this Article, an agricultural producer and the insurer shall comply with the following provisions:

a/ Within 5 working days after becoming no longer eligible for agricultural insurance premium support, the agricultural producer shall notify such to the commune-level People’s Committee for carrying out the procedures prescribed in Clause 4, Article 24 of this Decree and to the insurer for carrying out the procedures for refund of the insurance premium already received from the state budget. The notice must indicate the time when the agricultural producer is no longer eligible for agricultural insurance premium support;

b/ Insurers shall handle legal consequences related to the premiums received the state budget according to Clause 6 of this Article.

6. Order and procedures for refund of insurance premiums received from the state budget

a/ Within 10 days after the end of a month, an insurer shall summarize the cases specified in Clause 4 of this Article and send a written notice (directly or by post) to the provincial-level  Agriculture and Rural Development Department which has received dossiers of request for payment of agricultural insurance premiums;

b/ Within 10 days after receiving a written notice of the insurer, the provincial-level Agriculture and Rural Development Department shall assume the prime responsibility for, and coordinate with the provincial-level Finance Department and the insurer in, completing the appraisal of:

- The insurance premium amounts to be refunded by agricultural producers to the state budget corresponding to the remaining period of the insurance contract after deducting reasonable expenses related to the contracts (for cases in which the state budget has fully transferred agricultural insurance premium supports to agricultural producers). Reasonable expenses shall be determined according to the agreement in the insurance contract;

- The insurance premium amounts to be paid by the state budget to the insurer corresponding to the insured period up to the time the insurance contract terminates (for cases in which the state budget has not yet fully transferred agricultural insurance premium supports to agricultural producers).

For the cases specified at Point a, Clause 4 of this Article, the remaining period of an insurance contract shall be counted from the time the agricultural producer no longer meets all the conditions for enjoying agricultural insurance premium support.

For the cases specified at Point b, Clause 4 of this Article, the remaining period of the insurance contract shall be counted from the date of termination of the insurance effect ahead of time.

The appraisal results shall be documented and kept at the provincial-level Agriculture and Rural Development Department.

c/ Based on the appraisal results, within 10 days, the provincial-level Agriculture and Rural Development Department shall make and submit a report thereon to the provincial-level People’s Committee for consideration and decision to transfer to the insurer or request the insurer to refund to the state budget the premium amount specified at Point b of this Clause.

This decision shall be sent to the provincial-level Agriculture and Rural Development Department, Finance Department and State Treasury, the district-level People’s Committee of the locality where the beneficiaries are located, and the insurer concerned;

d/ Within 10 days after the provincial-level People’s Committee issues the decision, the provincial-level Finance Department shall, based on this decision, issue an order of payment to the insurer via the provincial-level State Treasury, which shall transfer money to the insurer’s account at a commercial bank or the insurer shall directly come to the provincial-level State Treasury to carry out the procedures for refunding the money to the state budget.

Article 28.Budget estimation

At the time of making annual budget estimates, based on the number of agricultural producers eligible for support under the Prime Minister’s decisions and the demand for agricultural insurance, provincial-level Agriculture and Rural Development Departments shall estimate the amount of funds to support agricultural insurance premiums and send it to the provincial-level Finance Departments for summarization and clearly identify the funds to be covered by local budgets and supported by the central budget according to regulations, report them to the provincial-level People’s Committees together with the local budget expenditure estimates according to the Law on the State Budget, for sending to the Ministry of Finance for inclusion in the annual state budget estimates according to regulations.

Article 29.Allocation of fund estimates, management and finalization of funds

1. Estimate allocation

a/ Annually, based on the estimates assigned by the Prime Minister, the Ministry of Finance shall make targeted transfers from the central budget to local budgets for implementation of the agricultural insurance support policy according to this Decree;

b/ Based on the estimate assigned by the Prime Minister and the amount to be covered by the local budget, the provincial-level Finance Department shall assume the prime responsibility for, and coordinate with the provincial-level Agriculture and Rural Development Department in, elaborating a plan on allocation of the fund estimate, report it to the provincial-level People’s Committee for submission to the same-level People’s Council for consideration and decision to allocate funds for implementation of the agricultural insurance support policy in the approved expenditure estimate.

2. Management and finalization of funds

a/ Provincial-level People’s Committees shall manage, use and finalize funds for the proper purposes in accordance with the Law on the State Budget. At the end of a year, any unused fund for supporting agricultural insurance premiums must comply with the Law on the State Budget. In case of lacking funds in a year, localities shall take the initiative in advancing  funds for payment to insurers and, at the same time, send a  written request to the Ministry of Finance and Ministry of Agriculture and Rural Development for consideration and supplementation from the central budget (for localities supported by the central budget). Upon the expiration of the implementation period of the agricultural insurance support policy, any unused amount of the central budget support shall be refunded by localities to the central budget;

b/ Funds for supporting agricultural insurance premiums shall be included in final accounts of annual state budget expenditures of each budget level in accordance with the Law on the State Budget, guiding documents and the current State Budget Index.

Article 30.Conditions for insurers to implement agricultural insurance support policy

Insurers that wish to implement the agricultural insurance support policy must fully satisfy the following requirements:

1. To be allowed to perform the agricultural insurance operation according to their establishment and operation licenses, meet the law-prescribed requirements on capital and solvency and have procedures for exploitation, assessment and compensation for agricultural insurance, internal control and internal audit processes in accordance with law; and have safe, efficient and lawful agricultural reinsurance programs.

2. The leading insurer or the insurer designated to act as the focal point in the performance of an insurance contract must have its head office or branch in the province or centrally run city where the agricultural insurance support policy is implemented.

Article 31.Method of implementing agricultural insurance support policy

Insurers shall implement the agricultural insurance support policy by the method of co-insurance for all insurance contracts.

Article 32.Insurance contracts for implementation of agricultural insurance support policy

When entering into agricultural insurance contracts, agricultural producers eligible for agricultural insurance premium support and insurers shall comply with the following provisions:

1. The insurance contract contains all contents specified in Clause 1, Article 6 of this Decree.

2. Agricultural producers enter into insurance contracts when fully meeting the conditions for enjoying agricultural insurance premium support prescribed in Clause 2, Article 22 of this Decree and have been approved by the provincial-level People Committee as being eligible for agricultural insurance premium support under Article 24 of this Decree.

3. The insurance contract is entered independently from other agricultural insurance contracts.

4. Separately specifying the premiums which agricultural producers will receive from the state budget and the premiums to be paid by the agricultural producers themselves (without state budget support).

5. Specifically agreeing on the time limit and method of paying insurance premiums in accordance with law. For premiums supported by the state budget for agricultural producers, they shall be paid according to Article 26 of this Decree.

6. The agreed term of validity of the insurance must not exceed one year.

Article 33.Dossiers, order and procedures for approval/change of agricultural insurance products

1. Insurers that wish to provide agricultural insurance products for agricultural producers eligible for agricultural insurance premium support shall obtain approval from the Ministry of Finance before providing these products.

2. Insurers shall send (directly or by post) one set of dossier of request to the Ministry of Finance for approval, comprising:

a/ A written request for approval of agricultural insurance products, made according to Form No. 07 in the Appendix to this Decree;

b/ Rules, terms and premium tariffs of insurance products to be provided;

c/ Formulas, methods and explanations of technical bases used for calculation of insurance premiums and operational provisions of insurance products to be provided, certified by provision and solvency actuaries that insurance premiums are formulated based on statistics, ensuring the solvency of the insurer and corresponding to insurance conditions and liabilities;

d/ Forms of insurance request and insurance contract, product introduction document, sale illustration document and other forms of papers to be filled in and signed by insurance buyers upon insurance purchase.

3. Order and procedures for approval of agricultural insurance products

a/ Within 10 days after receiving a complete and valid dossier prescribed in Clause 2 of this Article, the Ministry of Finance shall summarize and consult the Ministry of Agriculture and Rural Development on the insurer’s request for approval of agricultural insurance products;

b/ Within 10 days after receiving a written request from the Ministry of Finance, the Ministry of Agriculture and Rural Development shall give written comments on the insurer’s request for approval of agricultural insurance products;

c/ Within 10 days after receiving the written comments of the Ministry of Agriculture and Rural Development, based on the insurer’s dossier of request for approval of agricultural insurance products, the Ministry of Finance shall consider and issue a written approval. In case of disapproval, it shall issue a written reply clearly stating the reason.

4. Insurers shall strictly abide by the approved rules, terms and premium tariffs. Any changes shall be approved by the Ministry of Finance before implementation.

Article 34.Monitoring of revenues and expenses

Insurers shall separately monitor revenues, expenses and results of implementation of agricultural insurance and revenues, expenses and results of implementation of the agricultural insurance support policy.

Chapter V

ORGANIZATION OF IMPLEMENTATION

Article 35.Responsibilities of the Ministry of Finance

1. To organize propaganda on agricultural insurance according to this Decree.

2. To assume the prime responsibility for, and coordinate with the Ministry of Agriculture and Rural Development in, drafting decisions of the Prime Minister according to Clause 1, Article 22 of this Decree.

3. To assume the prime responsibility for, and coordinate with the Ministry of Agriculture and Rural Development in, approving/changing agricultural insurance products under Article 33 of this Decree.

4. To arrange budget funds for the implementation of the agricultural insurance support policy.

5. To assume the prime responsibility for, and coordinate with the Ministry of Agriculture and Rural Development in, reporting to the Government or Prime Minister on the results of implementation of this Decree at the latter’s request.

Article 36.Responsibilities of the Ministry of Agriculture and Rural Development

1. To organize propaganda on the implementation of agricultural insurance according to this Decree.

2. To coordinate with the Ministry of Finance in drafting decisions of the Prime Minister according to Clause 1, Article 22 of this Decree.

3. To coordinate with the Ministry of Finance in approving/changing agricultural insurance products according to Article 33 of this Decree.

4. To promulgate documents guiding the process of announcement of natural disasters and process for certification of natural disasters and epidemics according to Article 20 of this Decree.

5. To coordinate with the Ministry of Finance in reporting to the Government and Prime Minister on the results of implementation of this Decree at the latter’s request.

6. To promulgate technical processes, regulations and standards in agricultural production to facilitate the implementation of agricultural insurance and agricultural insurance support policy.

Article 37.Responsibilities of provincial-level People’s Committees

1. To organize the propaganda for and mobilize agricultural producers to implement agricultural insurance according to this Decree.

2. To organize the implementation of agricultural insurance and agricultural insurance support policy according to this Decree. To direct provincial-level departments and sectors and lower-level local administrations to coordinate with one another in the implementation of agricultural insurance and agricultural insurance support policy according to this Decree.

3. To organize the approval of support beneficiaries according to Article 24 of this Decree.

4. Based on the budget estimates already approved by competent authorities, to arrange local budgets to provide support for agricultural insurance premiums and allocate funds for this support according to this Decree.

5. To direct related agencies to organize the control of risks, prevention and limitation of losses and prevention and combat of insurance frauds according to Section 2, Chapter II of this Decree.

6. To implement the following reporting regime:

a/ Quarterly and annually, to make detailed reports on funds to support agricultural insurance support premiums, made according to Form No. 08 in the Appendix to this Decree, and send them to the Ministry of Finance; and reports on the results of implementation of agricultural insurance for plants, animals and aquaculture according to Form No. 09 in the Appendix to this Decree and send them to the Ministry of Agriculture and Rural Development.

b/ Reporting time limits

- Quarterly reports: within 30 days after the end of every quarter.

- Annual reports: within 60 days after the end of the fiscal year.

Article 38.Responsibilities of the Vietnam Farmers Association

1. To coordinate with local administrations in organizing the implementation of agricultural insurance according to this Decree.

2. To guide and mobilize its members to abide by the law on the implementation of agricultural insurance and relevant laws on cultivation, husbandry, forestry and aquaculture.

3. To take the initiative in organizing propaganda on the implementation of agricultural insurance according to this Decree.

Article 39.Responsibilities of insurers

1. To organize the implementation of agricultural insurance and agricultural insurance support policy according to this Decree.

2. Insurers that implement the agricultural insurance support policy:

a/ To make and send monthly, quarterly and annual operational reports to the Ministry of Finance, made according to Forms No. 10 and No. 11 in the Appendix to this Decree, and quarterly and annual reports on business results, made according to Forms No. 12 and No. 13 in the Appendix to this Decree;

b/ Reporting time limits

- Monthly reports: within 15 days after the end of every month.

- Quarterly reports: within 30 days after the end of every quarter.

- Annual reports: within 90 days after the end of the fiscal year.

c/ In addition to the operational reports specified at Point a of this Clause, the Ministry of Finance may request the insurers to report on their operation and financial situation to serve statistical work and evaluation of the implementation of agricultural insurance;

d/ Insurers shall take responsibility for the accuracy and truthfulness of their reports.

Chapter V

IMPLEMENTATION PROVISIONS

Article 40.Effect

1. This Decree takes effect on June 5, 2018. The period of provision of agricultural insurance premium support shall be stated in decisions of the Prime Minister according to Clause 1, Article 22 of this Decree.

2. Ministers, heads of ministerial-level agencies, heads of government-attached agencies, chairpersons of provincial-level People’s Committees and subjects of application of this Decree shall implement this Decree.-

On behalf of the Government 
Prime Minister
NGUYEN XUAN PHUC

*The Appendix to this Decree is not translated.