Insurance in Costa Rica: Get to know the basics

May 11, 2023 in Life in Costa Rica, Tips for Buyers

Costa Rica has long had a socialized system that universally protects its citizens’ and residents’ health and property through inexpensive mandatory basic insurance in Costa Rica. The insurance monopolies that operate in Costa Rica offer good basic coverage, while a number of private providers are finding their way due to trade policy changes in the last ten years. Read below for the current state of different types of insurance in Costa Rica, and a little bit about what to expect.


Health and medical insurance in Costa Rica


For many years, the only option for health and medical insurance in Costa Rica was with the National Insurance Institute (INS). You can now find a number of national and international health insurance providers throughout Costa Rica. Some offer coverage for pre-existing conditions and check ups while others don’t. A large number of international health insurers offer specialty expat health policies that includes international travel.


CAJA is the socialized medicine system in Costa Rica. It is inexpensive at around $70-100 per couple per month for full coverage of pre-existing conditions, doctor visits, prescription drugs, examinations, hospitalization, dental and eyes. And there is no limit on annual amounts paid out by the plan. Some procedures require months of wait-time, though, so most expats prefer to have combination of CAJA and private health insurance in Costa Rica.


Car insurance


Car insurance is not mandatory in Costa Rica. Liability insurance (called marchamo) from INS is mandated by law but it only provides minimal coverage. Car insurance costs in Costa Rica is fairly comparable to North American rates and many locals forego insuring their vehicles. Most expats choose to insure their vehicles, whether they import a car to Costa Rica or buy one here.


INS continues to have a monopoly on the car insurance market and their rates depend on the vehicle-type and the driver’s record. Their car insurance covers the vehicle regardless of who is driving, and plans offer a variety of coverage, from liability, theft, fire, and flood to full-coverage. A full-coverage plan from INS includes hospital visits in the event of an accident in the car, even if the victim does not have health insurance and a set number of free tows or assistance in case you lock your keys in the car.


Signing up requires visiting an INS office and taking photos of your car to file. If you miss a payment with INS, your policy is automatically cancelled and will have to be renewed in the office, with new photos taken.


INS does not increase your rate after your first accident. You will have to pay the deductible for every accident afterwards and will be subject to rate increases. In some cases, if the damages are very minor, it is better and cheaper to have them fixed without tapping into the INS policy or using the first time ‘freebie’.


Rental car insurance


Car rental agencies in Costa Rica offer both mandatory insurance and supplemental programs that cover deductibles and contingencies other than a simple traffic accident. The cost of insurance can approach or exceed the cost of renting a car in Costa Rica. Credit card coverage is often better than the insurance plan offered by the rental car company. Check that your credit card company does not have exclusions against Latin American rentals.


Mandatory INS liability insurance applies to all rental cars in Costa Rica. This cost ranges from US$10-20 per day. It does not cover damage to your rental car, only damages to other people and their property.


Home insurance


There are a number of insurance companies offering home insurance, however INS remains the predominant provider and most reliable for paying claims. Premiums range from 0.75% to 1.5% plus 13% sales tax annually depending on your property’s location and security. Each company has a variety of policies that include coverage for fire and natural disasters like landslide, flood, earthquake and hurricanes, so homeowner’s can select specific plans with different coverages. For example a home valued at $335,000 with $50,000 in contents may cost approximately $800 US per year, or $1,100 US with additional personal liability coverage.


Having additional personal liability coverage is important if you plan to rent the house to guests. In the case that a guest suffers a personal injury, your insurance will cover for their healthcare and potential lawsuit.


If you are going to be away from your property for more than 48 hours, you may be required to alert  your insurance provider in writing at least one week in advance and you must hire a house sitter or guard to watch the property.  Currently insurance providers only cover contents for theft if the home has an alarm system and surveillance cameras installed.  This coverage is limited to the contents of a home inventory list that you provide when you sign up. The details of this list include the current estimated market value to replace the items on the list. It is up to you to keep this list current with prices and items you own.


Worker’s insurance


When you enter into an employer-employee relationship in your business in Costa Rica, you become subject to the legal dispositions of the Costa Rican Labor Code. As an employer, you gain obligations with the Costa Rican Social Security Administration and INS. 


Worker’s compensation in Costa Rica covers injuries for accidents or illness of the employee that is work related. Every employer is under the legal obligation to provide a Worker’s Compensation Insurance Policy for their employee. If your employee is injured and you do not have the insurance, you will be liable for the medical expenses incurred. This obligation may extend to home owner’s hiring a maid or a part time gardener, depending on the circumstances.


Comment below with any questions that you may have about this topic or any others. Thanks for reading!


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