San José, Costa Rica, since 1956

INS Offers Bonuses, Surcharges, Discounts

Insurance is seldom a bargain, but you should know that the National Insurance Institute (INS), the local insurance monopoly, has a program of discounts that can reduce the cost of some policies to bargain levels, and this is the subject for today’s article. But, dear reader, before you start jumping up and down and throwing your hat in the air, please be informed that INS also has a program of surcharges.

Automobile Insurance

Brand-new passenger vehicles (cars, SUVs and station wagons, but not pickups, minibuses, trucks, ATVs or motorcycles) of the current model year, when insured at the dealer’s showroom, get a new-car discount of 30% off the premium for the first insured period, usually six months. To get the discount, in addition to the usual formalities (signed application, payment of premium), the insurance agent must deliver to INS a copy of the invoice (factura) of the new vehicle, and it must not be stale-dated more than three days.

Also, there is a no-claims bonus whereby if a person goes two years without a claim, at the start of the fifth semester, bonuses start to accrue in increments of 5% every six months. In other words, if you go four semesters without a claim being paid by INS, you will get a 5% discount on the fifth semester, 10% on the sixth semester, and so on, up to the maximum 40%. If a person has more than one policy, the same bonus applies to all. Also, if you cancel your auto insurance and then, after a year or so, apply for a new policy, you will get the same bonus as you had before you cancelled.

If you have a claim charged to your policy, the no-claims bonus can be reduced or lost, or –in the case of a large claim or a succession of smaller ones – you will lose the discount and get a dangerous-driver surcharge on your auto premium.

The wisdom to be derived from this is that if you have several cars and one of the drivers in your family is more accident-prone, register (and insure) in his or her name the car that person drives, so that if the discount is lost or a surcharge is applied, it affects only the policy in the name of the accident-prone driver.

The new-car discount and the no-claims bonus are not cumulative. For example, if you have a 35% no-claims bonus and you purchase a new car in the showroom, you mustn’t expect the 30% new-car discount to be added to the 35%; you will get only the larger of the two discounts.

A security discount is offered if the car is equipped with a certain type of alarm. Only one type of alarm qualifies (the most expensive one on the market, of course) and the discount is 30% off the part of the premium corresponding to the sub-coverage for auto theft – in other words, not very many dollars and cents! Also, the type of alarm that qualifies is expensive not only to purchase but also to install and maintain. And every year you have to provide INS with a certification that the alarm is still fully operational, or the discount is lost. The alarm in question seems to be foolproof and burglarproof, so my feeling is that if I had that type of alarm, I wouldn’t pay additional money to have auto theft insurance, however well discounted.

There is a discount for motorcycles, which applies to those of 600 cc or more, less than 10 years old. This discount applies only to the cost of the collision and theft part of the premium, not to the liability part.

Policies covering cars with diplomatic or MI registration get a 20% discount off the entire premium.

Medical Insurance

INS offers two general types of medical insurance: Plan 16, which is in colones, and INS Medical, which is in dollars.

Plan 16 individual policies (not groups) get a family discount, which means that if two people (spouses, presumably) are insured on the same policy, there is a 5% discount off the premium; if more than two are insured (spouses, plus at least one dependent offspring under 24), the discount is 7.5%. The INS Medical plans offer no discounts.

But both types carry the threat of surcharges – if a person’s weight-to-height ratio exceeds certain parameters, or if a person upgrades his or her insurance and wants pre-existing medical conditions to be covered by the new plan, INS, at its discretion, may apply a surcharge.

Other Types of Policies

A few other types of policies have the possibility of discounts and surcharges. For example, the home theft policy allows a discount if the home has a certain sort of burglar alarm or is close to a police station, but a surcharge if it is in a remote location; the electronic equipment policy is discounted if there is a lightning conductor, etc. But as these policies are seldom sold and interest few people, I will not provide further details.


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