Nicaragua's congressional production, economy and budget committee has concluded its consultation on the proposed new insurance law in the country, congress reported on its website.
The country's President Daniel Ortega introduced reforms to the existing insurance law in March aimed at modernizing the law to fit the current nature of global finance. The proposal was sent in May to the committee, which decided to integrate the proposed reforms into an entirely new insurance and reinsurance law, committee president Wálmaro Gutiérrez was quoted as saying in the report.
Once the new law is passed, transnational institutions and insurance companies will have improved legal protection, making investing in the country more appealing, Gutiérrez said.
The law will also establish standards for insurance contracts, specify financial sector regulator Siboif's powers to protect public interest, and ensure the health of the sector, he said.
The existing law was created in 1976 and reformed in 1996.
Nicaragua's insurance market this year grew by 7.6% through August compared to the same period in 2008, local news service Canal 15 reported Siboif head Víctor Urcuyo as saying.
Metropolitana Compañía de Seguros, owned by Panama-based financial services group Grupo ASSA, is the country's biggest insurer, with 30% of net written premiums in the first half of 2009. Five insurance companies operate in the Nicaraguan market.
The most recent attempt by an international company to enter the Nicaraguan market fell through in May, when Nicaragua's Seguros América, the country's third biggest insurer as of end-June, broke off talks to be acquired by Costa Rica's Instituto Nacional de Seguros (INS).