Market Opening Led to Lower Insurance Rates

After two years of full competition in Costa Rica, insurers are keeping in place aggressive pricing tactics and incentives in the battle for customers.

Tuesday, July 2, 2013

In an interview conducted by Sergio Morales for, William Constenla, president of the National Insurance Institute (INS by its initials in Spanish), explained that the company has been forced to confront the price war by offering more services or range of products, offering, for example, zero deductible car insurance, which means that the insured party does not have to pay anything in case of an accident.

According to Constenla, the insurance price war is mainly in the lines of cars and earthquake and fire insurance.

To the question, what is causing there to be more premium income, but a lower rate of profit than last year?, Constenla responded that there are more insurance companies struggling to keep customers, this fight involves tariff reductions which in some cases have been very significant.

"The drop in prices has been maintained, the fight for the customers is still in force, I do not know how long it will last because if you look at the companies income statements, there are only three that have positive numbers."

More on this topic

Insurance: The Fruits from Opening Up of the Market

August 2018

Ten years after the elimination of the insurance monopoly in Costa Rica, private insurers have managed to "steal" from the state company about 12% of the market.

Mapfre Seguros, Sagicor, Assa Compañía de Seguros and Best Meridian Insurance are some of the 12 private companies that have been competing in the Costa Rican insurance market since 2008, when the law came into force opening up the business which for more than 80 years was in the hands of a single company, Instituto Nacional de Seguros. 

Lower prices due to Airlines Competition

July 2014

The arrival of new competitors with frequencies between Colombia and Central America has generated a reduction in rates, favoring customers.

The opening of routes from Medellin and Bogota to Panama, by the airlines AirPanama and VivaColombia with fares "... up to 70% less than those offered by the subsidiary of Copa Holdings" is already generating benefits to travelers.

New Association of Insurance Companies in Costa Rica

February 2010

It groups all the insurance companies authorized to operate in the country.

Called ACAR (Costa Rican Association of Insurers and Reinsurers), it is chaired by Guillermo Constenla, head of INS, the National Insurance Institute.

“Constenla explained that the association has been created to assist the Insurance Superintendence in generating a more fluid insurance market”, reported El Economista.

Price war at sea

February 2009

Shipping companies are seeing a decrease in the volume of maritime cargo and their earnings, and have begun to pressure the Panama Canal concerning the toll.

The Panama Canal Authority has set a price increase schedule for the Canal toll for 2009 and 2010, and the large shipping companies, which are experiencing a decrease in earnings due to the drop in maritime trade, are looking for ports where they can operate a lower cost.