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The former monopoly by the National Insurance Institute of Costa Rica (INS) favored the sale of insurance by companies without presence in the country, specially in the life insurance segment.
Eduardo Recinos is the Director of Insurance at Fitch Ratings Centroamérica. When asked by Elfinancierocr.com if such insurance would migrate to the formal market, the expert replied: "Not automatically. In the rest of the countries of the region these activities continue, despite open markets and strict regulation penalizing such practices".
Source: elfinancierocr.com
More on this topic
September 2009
Fitch Rating's Special Report: "Insurance Industry Costa Rica: End of the State's Monopoly"
Costa Rica's insurance industry had been dominated by a state-owned monopoly until the new Insurance Law of 2008; up to December 2008 it is the largest and fastest growing market in Central America (excluding Panama).
July 2009
Starting June 2009, the bank is authorized to sell insurance, and it will start will INS policies.
Presently, Banco Popular only commercializes Popular Seguros services in its central offices, but will expand to other locations in the short and mid term.
Even though they might sell policies from other operators in the future, "currently there is only Sociedad de Seguros del Magisterio and the recently opened Grupo Mundial, so at first we will only work with INS, the strongest in the national market", commented William Alcázar, Popular Seguros manager, in an article in Elfinancierocr.com.
May 2009
The Comptroller General ruled that the National Insurance Institute can form a partnership with companies outside Costa Rica but not own them.
The subsidiary set up by the INS to operate outside the country, INS International SA, had already allocated funds to implement a plan that involved purchasing at least one company in each of the countries in the region to market insurance.
July 2009
The Panamanian insurer, owned by regional conglomerate Grupo Mundial, would operate in Costa Rica in 4 months.
As the insurance market opens in Costa Rica, Sociedad Aseguradora Mundial S.A. is the first foreign capital company to be authorized by the Pensions Superintendence (Supen, spanish acronym) to compete with the state's "Instituto Nacional de Seguros" and "Sociedad de Seguros del Magisterio" the first Costa Rican competitor.
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