Legislators Vote in
Favour Of Ending
Insurance Monopoly
The Legislative Assembly
last night made away
with the 84 year
monopoly on insurance in
the country held by the
state institution - the
Instituto Nacional de
Seguros (INS) - and set
regulations for the
operation of private
insurers.
The vote was 29 in
favour and 14 against
when at 9:52pm the bill
proposed by the
government passed in
first reading.
The bill is part of the
reforms for the
implementation of the
Tratado de Libre
Comercio (TLC) - free
trade agreement with the
United States, Central
America and the
Dominican Republic.
The bill - Ley
reguladora del mercado
de los seguros - will
leave the INS, created
in 1924, as the major
player in a competitive
insurance market that
will be made up of
national and
international insurers.
"The change will mean an
open market but well
regulated", said
legislator Maureen
Ballestero.
One of the concerns
raised by the ending of
the monopoly is the
future of the Cuerpo de
Bomberos (fire
department) which now
gets its funding and is
under the direct control
of the INS. The bomberos,
under the new system,
will be given more
autonomy and financed
with 4% of the insurance
premiums.
The bill also sets out
government and public
institutions can only
purchase insurance from
the INS and that INS
will continue to have
exclusivity over the "seguros
solidarios", that is the
obligatory automobile
insurance, workers and
crop insurance policies.
Supporters of the change
see this as an
opportunity for Costa
Ricans to be able to
purchase a variety of
different insurance
products, much more than
what the INS currently
provides.
For the bill to become
law it requires second
reading which is
expected on Tuesday.
However, the passing of
the bill does not mean
an instant flood of
insurers in the market.
A regulatory structure
that will known as the "Superintendencia
General de Seguros" has
to be developed and put
in place, which may take
up to two years. |
|
