This Act is enacted to establish an agricultural insurance system, make up for losses sustained by the agriculture, forestry, fishery and animal industry businesses from natural disasters, strengthen protection for agricultural operations and stabilize the income for farmers.

The term “competent authority” as used in this Act means the Council of Agriculture of the Executive Yuan.

The terms as used in this Act are defined as follows:
(1) “Agricultural insurance” means an insurance coverage that is announced by the competent authority to make up for actual or presumed losses caused by natural disasters or other events to the subject matter insured.
(2) “Subject matter insured” means an item related to a product of the agriculture, forestry, fishery or animal industry business.
(3) “Insurance enterprise” means an entity approved by the Financial Supervisory Commission that has been established and registered in accordance with the law to engage in the insurance business.
(4) “Insurer” means an insurance enterprise and a farmers’ or fishermen’s association that has a right to claim a premium upon entering into an agricultural insurance contract and is liable for indemnification in accordance with the contracted insurance obligations when an insured hazardous incident occurs.
(5) “Proposer” means a person having an insurable interest in the subject matter insured who applies with an insurer to enter into an agricultural insurance contract and is obliged to pay a premium.
(6) “Insured” means a person actually engaged in agriculture, forestry, fishery or animal industry business who, upon incurring damage as a result of an insured incident, enjoys the right to claim indemnification. A proposer may also be the insured.

The insurer shall conduct agricultural insurance business in accordance with the provisions of this Act. Matters not provided in this Act shall be governed by provisions of the Insurance Act for insurance enterprise. The provisions of Chapter 1 to 3 of the preceding act shall apply mutatis mutandis to a farmers’ or fishermen’s association.