Costa Rica News – Semana Santa is finally over with 25 deaths reported during the week, the most in Central America. How many of those had insurance? Was coverage by the Costa Rica INS State insurance enough?
The insurance market in Costa Rica has grown from five firms in 2010, when participation of private companies was allowed to 13 companies in January. Insurance premiums increasing nearly $ 13 million in the period.
The 13 insurers reported in the first month of 2013 about $ 97 million in direct premiums, about $ 13 million more than the same month in 2010.
In total, in 2012 the Costa Rican insurance market transfers had $ 640 million in voluntary insurance premiums (personal and general). If the compulsory National Insurance Institute (mandatory occupational hazards and automotive) premiums are added to this amount, the total would be $ 928.5 million.
The latest company to obtain authorization to provide insurance in Costa Rica is Sagicor, from Barbados which has offices in over 20 countries. The Venezuelan Oceanic Insurance company has conditional operation permit while registration in completed.
Other insurance companies are Mapfre, Assa, Adisa, Seguros Bolívar, Alico, Pan American Life, Qualitas, Southern Atlantic, Best Meridian, Teachers Insurance and the INS state, which operated as a monopoly in Costa Rica for more than 85 years.
The law to allow private insurance was passed 2008, but it was not until 2010 that the private companies could start marketing policies. As most things in Costa Rica, it takes time to actually implement a law.
The INS maintains its dominance with 90% market share, especially in general insurance (protecting property). However, the INS has had major market share losses in the personal insurance sector where they only have a 71% share.
Pan American already made great strides and now has with 19% share in the personal insurance area where its strength is in the accident and health policies. It currently has a 36% of the accident and health policies, competing closely with the 55% of INS.
Pan American currently carrying out a merger with Alico, after acquiring the parent company, MetLife, which has subsidiaries in Central America and the Caribbean.
Government run monopolies in both insurance and telecommunications in Costa Rica are finally being broken down. The monopolies allowed the agencies to provide poor customer service and all in all did not meet the expectations and needs of its clients. Now that other options are available, competition is making these government agencies change or go out of business.
In 3 years the INS has lost 10% of its market share and that number will continue to fall as more companies show the population of Costa Rica there are other better options for them to chose from. Costa Rica is very hesitant to change but when it does brighter days are ahead.