Insurance-What You See is not Always What You Get

A recent alert published by Panama’s insurance regulatory agency, La Superintendencia de Seguros y Reaseguros de Panamá, on MS-Panamá points to the glaring need for more regulation of this thriving sector in the country.  It also points to the acute deficiencies in services.

The case with MS-Panamá, which partners with San Fernando Hospital and claims to administrator hospital services but also offers medical coverage as if they were providing medical insurance is just one example.

Medical Service Panama (MS Panama), as they’ve claimed in their advertising and social networking pages “promotes and administers a hospital medical assistance program linked to San Fernando Hospital, Panama and in Coronado.”

The Superintendence of Insurance and Reinsurance of Panama published an alert at the end of October warning that MS-Panama, which also has an office in the Province of Chiriquí, operates outside the law and that it cannot legally offer any product or service that can be considered exclusive to insurers in Panama.

The company promotes an individual plan through its website which promises all kinds of hospital coverage for up to 25 thousand dollars a year with premium rates ranging from $26 per month to $130, depending on the age of the insured.  It also offers a family plan and a business plan at rates of between $20-50 per month.

The superintendent, Luis Della Togna, stated that he has acted as far as the law will permit him in putting out this warning and informing the public that MS Panama does not have the necessary reserves to provide coverage when the customers put in a claim.  In fact, the Superintendence has received several complaints with regards to the coverage that MS Panama promotes and those which it finally assumes.  Another notable fact is that that most of MS Panama’s clients are the elderly.

Which brings us to our motive for writing this article: many of our readers are seeking information about hospitals and life and medical insurance companies in Panama.  With good reason they are doing their homework before making an important move like finally moving to Panama be it after putting in for retirement or for relocation purposes.  This intelligent approach to making such life changing decisions is extremely advisable as all signs point to Panama taking firmer steps in regulating the insurance industry.

MS Panama and companies like them have been following closely the progress of a Bill in the National Assembly, Proyecto de Ley 360 which was in first debate and which “regulates the insurance activity and dictates other dispositions.”  The history of insurance regulatory laws only dates from 1996, so this is quite new and warrants follow-up.  It was the intention of MS-Panama, in fact, to be included in the law as a “micro-insurance” company, but for this they must have a license and comply with all the requirements of capital and solvency required by law.  More about the differences between insurance companies and micro-insurance in our next post as the agencies offering this type of coverage will soon be on the rise.

As you can see, deciding upon what insurance to buy and which company to go with is still quite a “buyer beware” situation here in Panama just as anywhere else.  It is especially important to persons who are investing their hard earned retirement money and in great need of these services.  Now more than ever, we need to be “wise as serpents.”