La Nacion of Costa Rica reports that the new Superintendencia General de Seguros (Sugese) is investigating 15 persons concerning allegations of illegal sales of foreign insurance policies. Complaints were filed with Sugese against the 15 persons by the Instituto Nacional de Seguros (INS), which until recently held a government-imposed monopoly on insurance sales and remains the only entity currently authorized to sell insurance in Costa Rica. Although foreign insurers may now establish subsidiaries in Costa Rica, none have yet done so and sale of foreign policies remains prohibited in Costa Rica.
(To read our prior post on the opening of the Costa Rican insurance market, please click here).
Tomas Soley, the new superintendent, reportedly indicated that the allegations would be investigated in due course, but did not provide a timetable for any resolution. Potential fines for illegal sales of foreign insurance (the definition of which includes marketing of foreign policies by phone, email or facsimile) can exceed $200,000 under the new insurance laws.
An INS representative reportedly stated that the INS became aware of the illegal activity based upon reports from consumers and further stated that the INS intends to file complaints against additional persons. The INS representative also reportedly commented that, although the INS has always been aware of illegal insurance sales activity, difficulties in making complaints and minor penalties provided no incentive to report such activities under the prior laws.