In addition to opening the Costa Rican insurance and reinsurance market to private competition, the new laws and regulations enacted since the Fall of 2008 permit the Instituto Nacional de Seguros (INS), the former holder of the government monopoly over the industry, to diversify its investments in an effort to seek better returns. To that end, the INS recently announced two agreements with the Costa Rican electrical utility, the Instituto Nacional de Electricidad (INE), to invest in two bond offerings by the INE.
The INE bonds are intended to fund the expansion of and improvements to the national electrical system. Guillermo Constenla, executive president of the INS, reportedly commented as follows regarding the new agreements: “The investment that we are now making in the ICE is part of the diversification that we are undertaking in our investment portfolio. More than that, it represents a contribution to the Costa Rican population, given that we are investing some of our capital in the public works infrastructure in an area as sensible as production of electricity that benefits the country.”