Assessing opportunity and risk in the Costa Rican market

*M. Machua Millett considers the prospects and challenges of the Costa Rican market since the end of the government monopoly in August last year

While relatively small in comparison to the major Latin American insurance markets, Costa Rica is the largest insurance market in Central America (excluding Panama). The country also has a uniquely diversified economy for the region, has experienced rapid annual growth in the insurance market (between 15% and 46% annual growth in recent years) and still has a relatively low insurance penetration rate (2.6%). Prior to 2008, however, the country had maintained a government monopoly over the insurance and reinsurance market through the Instituto Nacional de Seguros (INS).