Compulsory Vehicle Insurance Opened Up to Competition

Rules have been published in Costa Rica which must be followed by any private insurance company willing to sell mandatory vehicle insurance, which until now could only be issued by the state run insurance company.

Thursday, November 19, 2015

MOPT regulation number 39.303 published in the Official Newspaper, La Gaceta, establishes maximum profit margins, the conditions to be met by insurance companies who sell Compulsory Vehicle Insurance (SOA by its initials in Spanish) and other considerations.

"... The executive order provides that any company authorized by the Superintendent of Insurance (SUG) may sell the SOA directly or through authorized agents. The Sugese will be responsible for authorizing the SOA rate for each of the insurance companies. " reports that "... In no case will the Superintendency endorse rates whose profit margin is higher than 6%, as established in the rules. "

More on this topic

Incomplete Opening of the Insurance Market

November 2012

In Costa Rica compulsory motor insurance remains the monopoly of the state run insurance company, the INS.

A constitutional action filed against the opening up of the market for the Workplace Insurance, arguing that "this social insurance is designed to provide universal coverage at no cost to all people working in the country, against any accident or illness resulting from their activity ", has also detained the liberalization of the market for compulsory insurance for motor vehicles.

Costa Rica: Market Leader Avoids Competition

May 2011

The largest provider of insurance in Costa Rica might have difficulty getting used to competing.

In a market where there is a big player who for years has dominated the service, in this case, the Instituto Costarricense de Seguros, adapting to the new rules of a competitive market gets complicated.

Change comes to Costa Rica's national insurance company

July 2008

Costa Rica's passage of the Law to Regulate the Insurance Market has brought the National Insurance Company to a new stage, under which it gives up monopoly status at home but is allowed to enter foreign markets.

As a first stage of the internationalization of operations, the company is proposing to expand into Nicaragua over the next six months, and in 2009 it plans to enter the Panamanian marketplace.

Congress votes to remove state insurance monopoly

July 2008

Costa Rica's Congress approved a bill that will remove the state's monopoly of the insurance market.

As stipulated by the Constitutional Court, the bill was passed by a simple majority on a second reading. The bill also includes measures to strengthen the state insurance sector.