Vietnam: Risk control in agricultural insurance

According to Decree No. 58/2018/NĐ-CP of Vietnam’s Government, risk control in agricultural insurance helps parties feel more secure when participating in insurance contracts.

Responsibility for risk control, loss prevention and minimization and prevention and fight against insurance fraud

The insurer, policyholder, the insured and competent authorities shall control risks, prevent and minimize losses, and prevent and fight insurance fraud upon sale/purchase of agricultural insurance and implementation of agricultural insurance assistance policy in accordance with regulations.

Risk control

According to Decree No. 58/2018/NĐ-CP, control of risks during the policy period means a process of identifying, assessing, monitoring and managing inherent risks that may potentially exert a negative effect on sale of agricultural insurance and implementation of the agricultural insurance assistance policy.

The insurer shall:

- Formulate and take risk control measures and establish and follow risk control procedures specifying specific responsibilities of each individual and division for completion of the risk control procedures.

- Annually review and re-inspect risk control measures and risk control procedures to ensure their effectiveness and validity.

The policyholder and the insured shall, on their own initiative, take risk control measures and follow risk control procedures with respect to the subject matter insured during agricultural production, including complying with regulations on prevention and fight against animal diseases, plant quarantine and protection and environmental protection, technical standards in agricultural production issued by the competent authority and other relevant regulations of law on order to ensure safety of the subject matter insured.

Relevant authorities shall control, supervise and instruct agricultural producers to control risks during agricultural production; disseminate information concerning control of risks during agricultural production.

View more details at Decree No. 58/2018/NĐ-CP of Vietnam’s Government, effective from June 05, 2018.

-Thao Uyen-

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