Panama Insurance & Reinsurance


Panama has maintained leadership in the production of insurance and reinsurance in Central America by taking advantage of its market. In seeking to win investment from abroad and globally focused insurance companies, the country championed the introduction of innovative structures. The international insurance market now plays a key role in the evolution of Panama’s International Financial Center (IFC).

Building an Insurance Hub

Over the past decades, Panama’s insurance sector has undergone rapid change and reorganization. Private and commercial insurance was first developed between the two world wars when a number of underwriting agencies representing US and Italian insurance companies set up in Panama. This attracted insurers seeking a more cost-effective jurisdiction, as well as insurance companies or intermediaries seeking to tap into the LatAm insurance market.


Numbers Up

The Insurance & Reinsurance Authority (IRA)  has confirmed that there are 30 registered insurance companies in the country. Insurance companies ended 2015 with the issuance of 1,176,902 policies on average per month (81.497 or 7.5% more) than reported premiums $ 1,359.0 million ($ .16.0 million or 1.2% .adicional). Claims are also catered for $ 5,439.000.00 ($ .16.7 million, or 3.2% more).

Many names of repute, including international insurance managers such as AON, Marsh and Willis, have established operations or associations in Panama. Reinsurance companies AIG and Mapfre have a presence in the country.

Structured for Growth

Insurance business is licensed and regulated by the Panama Insurance Authority. Panama’s legislative framework is innovative in that it caters for insurance set-up options considered to be relatively new and progressive in the context of the rest of the LatAm. The country has also enacted legislation that allows the set-up of captives.

Industry Network

Insurance companies in Panama can rely on a wide support network, including 2 associations: the Panama Insurance Association (PIA) and the Association of Insurance Brokers (AIB). The sector is also backed by a large number of legal firms, as well as accounting and auditing practitioners that range from local practices to the global ‘Big Four’. Over the past years, Panama’s lawyers and accountants have also acquired the specialist insurance knowledge needed for more complex services, like the re-domiciliation of captives from another jurisdiction to Panama. Companies rarely encounter HR challenges. Office and administrative support such as secretaries, bookkeeping and accounting personnel, and claims and policy processing clerks can easily be sourced locally. While it is still the case that many professionals have acquired their qualifications overseas, the University of Panama now also offers specialist courses in insurance and finance.

Outsourcing & Relocation

Panama’s state-of-the-art telecoms network and its multi-lingual workforce also make the country an attractive outsourcing destination for foreign insurance companies, managers, brokers and other intermediaries. They can locate functions such as claims administration, analytics, customer care, policy administration, and sales and distribution to Panama with a view to reducing costs. With its innovative legislation and operational advantages, the country is possibly top of the list for companies that seek to relocate to another jurisdiction and require vehicles for specific needs, such as third-party business or solutions to reinsurance issues. Panama’s re-domiciliation legislation allows for a seamless transfer of structures in and out of the country, without the need to wind up operations.

Panama also offers significant cost advantages to insurance operators. Insurance companies can benefit from a competitive tax framework in addition to a network of double tax treaties. They are also exempt from paying duty on documents on the insurance of risks situated outside Panama. In addition, particularly when compared with other finance centers, fees for professional services, salaries and other operational costs are lower in Panama.

In recent years, smaller, closely held businesses have also learned that reinsurance entities can provide them significant benefits.

These include the attractive risk management elements long appreciated by the larger companies, as well as some attractive tax planning opportunities.

A properly structured and managed reinsurance program could provide the tax and nontax benefits:

    • Integrated risk management tools & techniques.
    • Capital efficiency solutions.
    • Optimizing strategies of insurance & reinsurance programs (beyond traditional risk transfer schemes).
    • Achieving cost savings objectives with greater degree of control over corporate risk financing strategy (through proper mix of risk retention/transfer).
    • Better understanding and participating in the risks / rewards within its own business and using own risk capital.  

We work closely with several reputable international reinsurance companies and together we may provide you “tailor-made” solutions.

Please contact us to schedule a teleconference to explain you the benefits of this structure.

The BusinessPanama Group provides a convenient One Stop Shop offering you the following services:

    • Incorporation of companies, trusts and foundations
    • Fiduciary management and administration of companies, trusts and foundations
    • Banking & trading accounts
    • Setting up of investment funds, partnerships, LLCs
    • Immigration & residence
    • Multi family office
    • Wealth management services

For more information, please contact us.