"Industry sources attribute the drop to three factors: the main one is the effect of British American Insurance Company's bankruptcy but increases in the cost of policies and the fact that people are choosing cheaper coverage with less benefits are also mentioned," reports Edith Castillo for Prensa.com.
Between January and July, the number of policies taken out has risen and fallen, with the largest drop of 83.3% seen in July.
34% more life insurance premiums where sold in the first six months of the year when compared to the same period of 2008.
The sectors with most growth, after life insurance, where fire (24.11%) and civil responsibility (24.8%).
"It is precisely in these types of insurance where prices rose the most", reports newspaper Prensa.com, "The only sectors where prices dropped are technical (-18.16%), multi risk (commercial, residential, -11.42%) and maritime hull (-11.47%)".
The policy offered by the bank requires no medical exams and is easy to obtain.
Another characteristic of this kind of policy is that there is no need to renew it every year and it covers natural and accidental death, total or permanent disability due to accidental causes and funeral expenses.
Surety bonds and collective and life insurance will be taxed 5%.
These new impositions are part of the fiscal adjustment law, and would increase the State's revenue in $11 million.
"Salvador Morales, executive vice president of Suramericana Insurance, argued that these changes are a 'hard blow' for the owners of life insurance, which plays a social protection role for families", reports Prensa.com.
Receive more news about Insurance
Suscribe FOR FREE to CentralAmericaDATA EXPRESS.
The most important news of Central America, every day.