The competent authority may elect the subject matter insured and conduct a trial operation of agricultural insurance in a designated area and period. Based on the results of the trial operations, it may be adopted as a fully promoted item.
The means, qualifications of the insured, scope, payment method and its effect, insurance amount, insurance type content of the payment items, review basis and other related matters of the trial operations of the agricultural insurance specified in the preceding paragraph shall be prescribed by the competent authority.

Based on the characteristic of the subject matter insured and the policy objective, an insurance enterprise or a farmers’ or fishermen’s association approved by the competent authority shall act as the insurer for agricultural insurance and conduct the agricultural insurance business.
The insurer specified in the preceding paragraph may entrust a farmers’ or fishermen’s association to handle the operations of the agricultural insurance.
The qualifications and requirements, procedure to apply for approval and rescission of approval for a farmers’ or fishermen’s association to serve as the insurer specified in the first paragraph, the scope of entrustment of the handling of the operations of agricultural insurance prescribed in the preceding paragraph and other matters to be complied with shall be prescribed by the competent authority.

Where a farmers’ or fishermen’s association serves as the insurer, it shall only handle agricultural insurance that meets the demand of the industry policy set down by the competent authority and shall enter into an insurance contract based on the agricultural insurance contract sample prescribed by the competent authority. The proposer, the insured, the subject matter insured, the insured incident, premium rate, reserve funds, re-insurance and other matters to be complied with shall be prescribed by the competent authority.
Where an insurance enterprise handles agricultural insurance, the insurance products shall be reported to the Financial Supervisory Commission by the insurance enterprise or the Non-Life Insurance Association of the Republic of China for review; permission of the competent authority shall be obtained before submission for review and the same shall apply in the event of amendments.

Based on the policy objective and the specific demands of the industry policy of agriculture, forestry, fishery and animal industry businesses, agricultural insurance may be handled by means of mandatory insurance in whole or in part or voluntary insurance. Where the insured party for the mandatory insurance fails to buy the insurance as required, the competent authority may withhold or at its discretion reduce the relevant measures related to the subject matter insured, including grant, subsidy, incentive reward, aid and relief.
With respect to the mandatory insurance specified in the preceding paragraph, the subject matter insured, scope, insured party, the measures that may be taken against an insured party for the mandatory insurance who fails to buy the insurance as required and other matters to be complied with shall be prescribed by the competent authority.