Major Insurance and Reinsurance Developments in 2008

Although all of the Latin American jurisdictions had notable regulatory and market developments in 2008, Costa Rica stands out as particularly significant given the the fundamental nature of the developments seen there in the past year.

Opportunity and Risk in a "New" Market

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 market through the Instituto Nacional de Seguros ("INS").