AM Best

AM Best Affirms Credit Ratings of Instituto Nacional de Seguros


Olga Rubo, FRM
Senior Financial Analyst
+52 55 1102 2720, ext. 134

Salvador Smith
Senior Financial Analyst
+52 55 1102 2720, ext. 109

Christopher Sharkey
Associate Director, Public Relations
+1 908 439 2200, ext. 5159

Al Slavin
Senior Public Relations Specialist
+1 908 439 2200, ext. 5098


MEXICO CITY - MAY 18, 2023 02:05 PM (EDT)
AM Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a” (Excellent) of Instituto Nacional de Seguros (INS) (San Jose, Costa Rica). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect INS’ balance sheet strength, which AM Best assesses as strongest, as well as its strong operating performance, neutral business profile and appropriate enterprise risk management (ERM).

INS’ risk-adjusted capitalization remains at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR), and is supported by a comprehensive and adequate reinsurance program, solid operating performance and its position as the leading insurer in Costa Rica. INS’ business profile assessment considers the characteristics of Costa Rica’s market, derived from the country’s Insurance Law of 2008, and includes INS’ robust market share and the guarantee provided by Costa Rica’s government to support INS’ domestic obligations.

INS is Costa Rica’s largest insurer with a market share of 65%, as of December 2022. The company still dominates compulsory workers’ compensation and mandatory auto insurance segments despite the market opening up for other participants several years ago. INS’ compulsory premium segment represents 35% of its business portfolio, as of December 2022.

In 2022, Costa Rica’s market showed a recovery, after being affected by a slowdown during the previous years, as a result of the economic contraction caused by the COVID-19 pandemic and an adverse fiscal situation. INS’ underwriting performance improved in comparison with 2021, mainly driven by a lower level of claims. The company has not relaxed its underwriting standards from the adjustments implemented in previous years, like the abandonment of poor-performing products in auto, personal property and group life.

INS presented a diminished return on equity of 3.3% from 12.3%, mainly due to mark-to-market losses. Investment income, based on a conservative investment portfolio, still contributed to a positive bottom-line result of USD 65.1 million at year-end 2022, providing a solid growth for its capital base, despite the effect of market volatility.

AM Best expects INS to continue improving and consolidating its business by implementing its strategy progressively, which should offset increased competition in the voluntary segments. The company is in a good position to maintain its strongest risk-adjusted capitalization, as measured by BCAR, due to its good profitability, appropriate ERM practices and adequate reinsurance with highly rated international reinsurers, which provides a buffer for variations in claim severity and catastrophe events.

Positive rating movements are not expected in the medium term. Negative rating actions could occur if technical results deteriorate or if there is a reduction in net income, given any kind of loss that significantly affects the company’s profitability or risk-adjusted capitalization to levels that are no longer supportive of its current ratings.

The methodology used in determining these ratings is Best’s Credit Rating Methodology (Version Nov. 13, 2020), which provides a comprehensive explanation of AM Best’s rating process and contains the different rating criteria employed in the rating process. Best’s Credit Rating Methodology can be found at

Key insurance criteria reports utilized:

  • Evaluating Country Risk (Version May 4, 2023)

  • Understanding Global BCAR (Version June 30, 2022)

  • Catastrophe Analysis in A.M. Best Ratings (Version March 10, 2023)

  • Available Capital & Holding Company Analysis (Version Oct. 13, 2017)

  • Scoring and Assessing Innovation (Version Feb. 27, 2023)

View a general description of the policies and procedures used to determine credit ratings. For information on the meaning of ratings, structure, voting and the committee process for determining the ratings and monitoring activities, please refer to Guide to Best’s Credit Ratings.

  • Previous Rating Date: May 19, 2022

  • Date Range of Financial Data Used: Dec. 31, 2016-Dec. 31, 2022

This press release relates to rating(s) that have been published on AM Best’s website. For additional rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page.

If the ratings referred in this press release do not indicate a specific country suffix, it is understood that they are granted globally and not on a national scale.

AM Best does not validate or certify the information provided by the client in order to issue a credit rating.

While the information obtained from the material source(s) is believed to be reliable, its accuracy is not guaranteed. AM Best does not audit the company’s financial records or statements, or otherwise independently verify the accuracy and reliability of the information; therefore, AM Best cannot attest as to the accuracy of the information provided.

AM Best’s credit ratings are independent and objective opinions, not statements of fact. AM Best is not an Investment Advisor, does not offer investment advice of any kind, nor does the company or its Ratings Analysts offer any form of structuring or financial advice. AM Best’s credit opinions are not recommendations to buy, sell or hold securities, or to make any other investment decisions. View our entire notice for complete details.

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AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City.

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AMB# Company Name
086238 Instituto Nacional de Seguros