THE NATIONAL FINANCIAL SYSTEM SUPERVISORY COUNCIL.

SUGESE AGREEMENT 01-08

REGULATIONS ON AUTHORIZATIONS, REGISTRATION, AND

OPERATING REQUIREMENTS FOR ENTITIES

SUPERVISED BY THE GENERAL INSURANCE SUPERINTENDENCY

Updated as of May 9, 2017

(Last Modification)

APPROVED BY THE NATIONAL FINANCIAL SYSTEM SUPERVISORY COUNCIL BY ARTICLE 6 OF THE

MINUTES OF MEETING 744-2008 HELD ON SEPTEMBER 18, 2008. PUBLISHED IN "LA GACETA"

OFFICIAL JOURNAL ISSUE 184 DATED SEPTEMBER 24, 2008.

Effective as of publication in La Gaceta.

"REGULATIONS ON AUTHORIZATIONS, REGISTRATION AND

OPERATING REQUIREMENTS FOR ENTITIES SUPERVISED BY THE

GENERAL INSURANCE SUPERINTENDENCY"

TITLE I

STANDALONE CHAPTER

GENERAL PROVISIONS

Article 1. Purpose

The purpose of these regulations is to establish the procedure, areas for analysis, requirements, and valuation

criteria that the General Insurance Superintendency will observe to rule on requests for proceedings subject

to authorization and the registration requirements indicated in these regulations. In addition, it defines the

minimum operating requirements to be met by the entities once they are authorized.

Article 2. Scope

These regulations are applicable to the insurance entities in the general, personal and mixed insurance

categories, insurance brokerage companies, insurance agency companies, and insurance agents and brokers.

Likewise, they are applicable for the applications for registration of representative offices cross-border

insurance providers, intermediaries, and auxiliary services.

The authorizations applicable to financial groups will be governed by SUGEF Document 8-08, the Regulations

on Authorizations for Entities Supervised by the General Financial Entity Superintendency (SUGEF) and for

authorizations and operations for financial groups and conglomerates.

Regular motions for dismissal or appeal may be filed against any administrative acts referenced in these

regulations, as set forth in the General Public Administration Law. Any motion for dismissal will be ruled

upon by the Superintendent and appeals will be ruled upon by the National Financial System Supervisory

Council.

3Article 3. Definitions

For applying these provisions, the following definitions are understood as follows:

a. Enterprise Risk Management: The set of objectives, policies, procedures, and actions whose purpose is

to identify, measure, monitor, limit, track, report, and reveal the different types of risk to which the

insurance entity is exposed.

b. Insurance Categories: The categories defined by law are general insurance and personal insurance. The

insurance branches that make up each category and lines of insurance that make up each branch for

authorization and reasonable requirement purposes are established in Appendix 1 of these regulations.

c. CONASSIF: The National Financial System Supervisory Council created by means of Article 169 of Law

7732, the Stock Market Regulatory Law dated December 17, 1997.

d. Director: Any individual who is part of a Board of Directors or an administrative council or any other

management body that has functions that are equivalent to the former two.

e. Executive: Any individual who, because of their function, responsibilities, or position in an entity, is

involved in or has the possibility of being involved in making important decisions for the entity.

f. Supervised Entity: Insurance entities and their brokers.

g. Insurance Entity: Insurance entities or branches of insurance entities created based on the laws of

other countries that are authorized to operate in Costa Rica and re-insurance entities.

h. Resulting Entity: New entity that results from two or more legal entities being merged to form a single

entity that stop exercising their individual legal entities.

i. Prevailing Entity: An entity that participates in the process of a merger by absorption, whose legal

entity prevails after this process has ended.

3 Modified by section 3, Article 9, of the minutes of meeting 1131-2014, held on October 27, 2014, published in La Gaceta number 228 on November 26, 2014.

j. Manager: Any individual who by law and due to his or her functions, responsibilities or position,

exercises or represents the maximum administrative authority in a legal entity.

k. Financial Group: A group of companies that engage in financial activities that were created as publicly

held companies or as entities of a cooperative nature that are subject to common control, common

management or functional association that have been created and registered in conformity with Law

7558,, the Constitutional Law of the Central Bank of Costa Rica, Article 8 of Law 8653, the Insurance

Market Regulatory Law, and these regulations.

l. Cross-border Insurance Commerce: When insurance products are sold by an insurance entity

established in a jurisdiction other than Costa Rica under the auspices of an international trade treaty

that is in place and has been subscribed to by the country. Only the services and the products provided

for in the international treaty may be procured using this mode under the conditions provided by the

treaty.

m. Law 8653: The Insurance Market Regulatory Law, Law 8653.

n. Compliance Officer: According to the contents of Law 8204, the “Law on Narcotics, Psychotropic

Substances, Unauthorized Drugs, Money Laundering, and Associated Activities," and the bylaws that

regulate the matter.

o. Share in Capital Stock: The percentage share in the capital stock of an entity is determined as the sum

of the following percentages:

i. The direct percentage share that a party has in an entity’s capital stock.

ii. The indirect percentage share that an individual has in an entity’s capital stock through

individuals that hold a direct or indirect share in the entity's capital stock with whom there

is some sort of relationship ties.

iii. The indirect percentage share that an individual or company has in an entity's capital stock

through companies that is calculated by multiplying the percentage shares through the

ownership line.

iv. The indirect percentage share that an individual or company has as a beneficiary in an

entity's capital stock through trusts or other similar vehicles.

v. Capital stock is understood to be common shares, preferential shares, and any other

security that represents capital stock.

p. Premium: An economic contribution that the policy holder or the insured must pay to the insurance

entity as compensation for the risk coverage that the insurance entity provides.

i. Pure premium or risk premium: this represents the simplest, most basic premium concept

because it means the cost of the actual risk assumed by the insurance company, including

any expenses attributable to benefits. It will also include the security surcharge.

ii. Inventory premium: the results of adding up the pure premium or risk premium, as the case

may be, the surcharge premium, and the management expense surcharge.

iii. Business premium, fee premium, or gross premium: the result of adding up the inventory

premium, acquisition expense surcharges, and the profits.

q. Surcharge: A set of variables that are added to the pure premium or the inventory premium, such as:

i. Security surcharge: a surcharge meant to compensate for any possible negative deviations in

the real and estimated accident rate.

ii. Management expense surcharge or internal management surcharge: used to finance

expenses such as wages, amortizations, or premium collections.

iii. Acquisition expense surcharge or commercialization surcharge or external management

surcharge: used to finance expenses such as brokerage fees and advertising.

iv. Profitability Surcharge: The benefit associated with the capital risked by the entity and the

work that the entity performs.

r. Relationship Ties: The relationship ties with the spouse and ancestors and descendants up to the second

degree of consanguinity or affinity.

s. Partner with a Relevant Share: Partners who hold a relevant share in the capital stock in the entity are

the following:

v. Any individual or company that possess a 10% share or more in the entity’s capital stock.

i. Any individual or company that possesses a 25% share or more in the capital stock of a

company that owns a supervised entity.

t. Applicant: Any party that submits an application for authorization or registration of the actions indicated

in these regulations.

u. Superintendency: The General Insurance Superintendency created by Law 8653.

v. Superintendent: The General Insurance Superintendent.

w. Entity Transformation: A process used for a supervised entity to modify its purpose, i.e., to specialize in

personal or general insurance in the case of mixed entities, or to transform itself into a mixed entity.

Insurance cooperative associations turn into publicly held companies.

x. Economic Agent: A public or private company that participates in an economic activity, in any fashion,

as the buyer or seller or demands goods or services in its own or some other party's name regardless of

whether they are imported or domestic or of whether they had been produced or provided by said

company or by a third party.

y. Premium Receipt: A document used by the insurance entity to acknowledge that it had received

premiums from the insured for a determined risk for the period that the document reports, plus any

taxes and other charges that the policy holder must pay.

TITLE II

AUTHORIZATIONS

CHAPTER I

GENERAL PROCEDURE

Article 4. Filing the Application2

An application may refer to one or more acts that need authorization, in which case the documents that are

shared by the acts can be filed a single time.

All applications must be filed with the Superintendent. An application must be signed by the entity’s legal

representative or whoever represents that entity filing the application. It must comply with all the

requirements established in legislation and these regulations and the general guidelines that are issued

2 Reformed by Article 5 of the minutes of meeting 1221-2015 dated December 21, 2015. Published in

La Gaceta issue 13 dated January 20, 2016.

By the Superintendent for that purpose.

3Article 5. Definition of Requirements

The requirements for authorization are detailed in the appendices defined for each process, which are an

integral part of these regulations.

APPENDIX 1. Definition of Insurance Categories, Branches and Lines.

APPENDIX 2. Insurance Entity Authorization

APPENDIX 3. Authorization for Insurance Brokerage Companies

APPENDIX 4. Authorization and Accreditation for Insurance Agency Companies

APPENDIX 5. Accreditation for Insurance Agents and Brokers

APPENDIX 6. Authorization for Merging Supervised Entities

APPENDIX 7. Authorization for Full or Partial Portfolio Transfer

APPENDIX 8. Authorization for the Supervised Entity to Change Its Name

APPENDIX 9. Authorization for a Supervised Entity to Voluntarily Cease Operations

APPENDIX 10. Authorization for Changes to an Insurance Entity's Articles of Incorporation

APPENDIX 11. Sworn Statement: Directors, General Manager, Assistant General Manager, Internal Auditor,

and Compliance Officer.

APPENDIX 12. Sworn Statement by Shareholders.

APPENDIX 13 Sworn Statement by Insurance Agents and Brokers

APPENDIX 14. Minimum Requirements for the Enterprise Risk Management System

APPENDIX 23. Authorization for Mandatory Insurance Premiums or Fees

APPENDIX 24. Cancelling Registration of Mandatory Insurance

3 Reformed by Article 8, section 2 of the minutes of meeting 894-2010, held on December 10, 2010. Effective

as of publication. La Gaceta number 248 dated December 22, 2010

7Article 6. Verification that the Documents Described in the Pertinent Annex Have Been Filed

The Superintendency has a maximum of fifteen business days after the application has been filed to verify

that all the documents described in the appendices to these regulations have been attached. If any of the

documents are missing, the Superintendency will communicate that fact to the applicant, who will be given

fifteen business days to complete the documentation.

8Article 7 Deadlines for Ruling on the Application

The Superintendency must issue and report the ruling on the application within a period of thirty business

days after the date of service of notification of compliance with all the documentation. Applications for

licensing and accreditation of agents and brokers are excluded from the foregoing, which will be governed in

conformity with the contents of Article 22.

For applications for authorization of mergers or portfolio transfer, compliance with the requirements will

consider the report by the Commission for the Promotion of Competition, defined in Article 27 bis of Law

7074.

9Article 8. Documentation Correction, Explanation, or Replacement

Within the timeframe for the ruling, the Superintendent must inform the applicant about correcting,

explaining, or replacing the documentation filed.

The applicant must provide the information required within a period of ten business days after the date that

the notification is issued.

This period may be extended by the Superintendent at the applicant’s justified request for up to a like period.

When the communication from the Superintendent is by fax or email, the period must be calculated based on

the business day following transmission.

The ruling period is suspended for the period used by the applicant to comply with what is being requested.

Article 9. Changes in the Information Filed

7 Reformed by Article 8 of the minutes of meeting 805-2009, dated September 11, 2009. La Gaceta, number

186, dated September 24, 2009. Effective as of publication in the La Gaceta official journal. 8 Reformed by Article 5 of the minutes of meeting 1221-2015 dated December 21, 2015. Published in La

Gaceta number 13 dated January 20, 2016. 9 Reformed by Article 5 of the minutes of meeting 1221-2015 dated December 21, 2015. Published in La

Gaceta number 13 dated January 20, 2016.

Within the ruling period, the applicant must report any fact or important situation that may change the

documentation filed. The communication must take place within three business days after becoming aware of

the fact or situation, at the latest. As soon as that communication takes place, the application ruling period

will be suspended until new documentation is filed.

The applicant must provide the required information within a period of ten business days after the date that

the applicant became aware of the fact or situation. This period may be extended by the Superintendent at

the applicant’s request for up to a like period when doing so may be justified.

Article 10. Document Effective Period

The date that the documents attached to the applications were issued may not be more than three months in

the past. The deadline is calculated based on the date that the application was filed. The audited financial

information will be valid for one year after the cut-off date.

Likewise, the application must state that the documents have not been altered since the date issued up to the

filing date.

Article 11. Documents Issued Abroad

Documents issued abroad must come with certification from the applicable consul. Documents written in a

language other than Spanish must have an official translation attached.

Article 12. Letter of Authorization Conditioned on Fulfilling the Pre-requisites and Registration

The Superintendency will issue a letter of authorization conditioned on fulfilling the following requisites:

a) Publication of an extract of the company’s articles of incorporation and any other data of public interest

through an edict published one time in the “La Gaceta” official journal. The edict must also be

published in a newspaper with national circulation. This publication must take place within 15 days

after the issuance of the letter of authorization conditioned on fulfilling the pre-requisites and

registration.

b) The plan for beginning the activities indicated in Appendices 2, 3, and 4 to these regulations must be

submitted. This plan must be submitted within one month after the issuance of the letter of

authorization conditioned on fulfilling the pre-requisites and registration.

c) The initial capital deposit in the Central Bank of Costa Rica according to Article 11 of Law 8653. The

deposit must be made at least one month prior to beginning activities.

d) The minimum security conditions for the physical infrastructure and information technology that are

indicated in Appendices 2, 3 and 4 to these regulations. The requirements must be met within four

months after the issuance of the letter of conditioned authorization. The Superintendency must be

asked to check the requirements. The Superintendency may, on a special basis, extend the time frame

for up to two additional months if the entity requests and is able to justify it.

Article 13. On Site Verification of Physical and Information Technology Security

The Superintendency has a period of one month after the application is filed to do a site check of the

minimum physical infrastructure and information technology security conditions.

Any weaknesses found by the Superintendency during the on-site check must be remedied within a period of

one month.

Based on an appropriate justification by the entity, the Superintendent may extend the period to begin

activities and must report that extension to CONASSIF.

7Article 14. Letter of Compliance with Requirements and Enrollment in the Registry.

The Superintendency will issue a letter of compliance with requirements and ask for the documentation to be

provided for registration. The applicant will have two months after the letter is issued to submit the

documents to the Superintendency for registration, as detailed in the Appendices to these regulations,

depending on the process involved so the Superintendency may proceed with registering the entity and

issuing the pertinent license.

7 Reformed by Article 5 of the minutes of meeting 1221-2015 dated December 21, 2015. Published in La Gaceta number 13 dated January 20, 2016.

Once the registration is completed, without prejudice to the obligations contained in Law 8653, the entities

must:

a) Report any change in the basic information for the accredited entity or brokerage companies by the

deadlines set forth in the law and these regulations.

b) Immediately report when the agencies or self-issuing insurance operators that had left their brokerage

network stopped operations.

If there is no explicit deadline for said updates, the entity must report them to the Superintendency within a

period of ten business days after the date of the change.

Article 15. Transmitting Partner, Articles of Incorporation, and Administrative Information about

Supervised Entities

The supervised entities must report the full name, identification number, percentage share, and changes in

the percentage share as of the last month reported about the shareholders with relevant shares in the capital

stock and the shareholders whose shares are no longer relevant. The contents of this paragraph do not

exempt anyone acquiring stock or any entity whose shares are traded on the stock market from carrying out

the communications set forth in Articles 34 and 35 of the Stock Market Regulatory Act.

The information referenced in this Article must be sent with a cut-off date as of the last day of the month

when the change was made, by the 16th business day of the following month at the latest.

Any modification to the articles of incorporation for the insurance entities will be subject to authorization first

as set forth in Article 29, section b) of Law 8653 and the provisions that these regulations levy.

Article 16. Integration Operating Plan

When an application for authorization for a merger is filed, the integration operating plan referenced in

Appendix 6 of these regulations must be filed within a period of three months after the date that the merger

authorization is communicated. The integration operating plan must ensure full integration of the

participating entities within twelve months after it is filed.

The entity may apply for an extension of the deadline for up to six months, in which case the Superintendent

will assess whether the justification provided is pertinent and will report it to the CONASSIF.

Article 17. Operating Plan for Portfolio Transfer and Voluntary Cessation of Activities

For applications for authorization for portfolio transfer or an application to voluntarily cease operations, the

Operating Plan referenced in Appendices 7 and 9 of these regulations must be filed within a period of 20

business days after the date the authorization was issued.

When the entity has provided an appropriate justification, the Superintendent may extend the Operating Plan

period up to 20 additional business days and must report the extension to the CONASSIF.

CHAPTER II

AUTHORIZATIONS FOR SUPERVISED ENTITIES

8Article 18. Actions Subject to Authorization and Requirements The following actions are subject to authorization:

a) Creating an insurance entity (Appendix 2).

b) Creating an insurance brokerage company (Appendix 3).

c) Creating and accrediting an insurance agency company (Appendix 4).

d) Accreditation for insurance agents and brokers (Appendices 5 and 13).

e) Merger of supervised entities (Appendix 6).

f) Total or partial portfolio transfer between insurance entities (Appendix 7).

g) Name change for a supervised entity (Appendix 8).

h) How a supervised entity may voluntarily cease operations (Appendix 9).

i) Changes in an insurance entity's articles of incorporation (Appendix 10).

j) Mandatory insurance premium or fee (Appendix 23).

k) Cancelling registration of mandatory insurance (Appendix 24)

Any authorization actions referenced in the authorization for a Public Stock Offering for open capital entities

will be governed by the contents of the Stock Market Regulatory Law.

8 Reformed by Article 5 of the minutes of meeting 1221-2015 dated December 21, 2015. Published in La Gaceta issue 13 dated January

20, 2016.

9Article 19. Enrollment and Registration

When the information for registration or registration cancellation related to the actions subject to

authorization implies that the Superintendency must register or update the information.

The following must mandatorily be registered:

a) Insurance entity registration:

10i. Personal, general, or mixed insurance entities, including branches of insurance entities created

based on the laws of other countries that are authorized to operate in Costa Rica.

ii. Re-insurance entities:

b) Insurance broker registration:

i. Insurance agency companies.

ii. Insurance broker companies.

iii. Insurance agents associated with an entity.

iv. Insurance brokers.

Article 20. Requirements for Creating an Insurance Entity, an Insurance Broker Company and an

Insurance Agency Company

To authorize the creation of a new insurance entity, an insurance agency company or an insurance broker

company, the applicant must provide the information listed in Appendices 2, 3, and 4 of these regulations as

the case may be, to the Superintendency.

9 Reformed by Article 5 of the minutes of meeting 1221-2015 dated December 21, 2015. Published in La

Gaceta number 13 dated January 20, 2016. 10 Modified by Article 15 of the minutes of meeting 849-2010 dated April 30, 2010. Effective as of publication.

La Gaceta number 115, June 2010.

Article 21. Information About Shareholders and Exceptions to Information Provision

The applicant must provide the information listed in Appendix 12 about all the shareholders down to the

individual level, regardless of whether or not the shares are held through agents, custodians, or other legal

entities through which the capital may be owned, including trusts.

After receiving approval, the requirement for shareholder information detailed in Appendices 2, 3, and 4 may

exclude the following:

a) When the shareholder is a company that is a public institution.

b) When the shareholder is a company that is an international or multilateral development organization.

c) When the shareholder is a company whose shares are traded on the domestic or an international stock

market.

d) When the shareholder is a financial entity subject to consolidated supervision by the supervisory

authorities in the shareholder's legal domicile.

e) When the shareholder is a cooperative association, a mutual association or a solidarity association.

The applicant must indicate the sections that are applicable to it.

11Article 22. Procedure for Authorization and Requirements for Licensing, Accreditation, and

Registration of an Individual Who Is a Broker

To accredit and register individuals who are insurance intermediaries, agents and brokers, the insurance

entity or the insurance broker company must fulfill the accreditation procedure that is defined by the

Superintendent in the general guidelines. This includes meeting the requirements found in Appendices 5 and

13 of these regulations. Once the process is finished, the Superintendency will send the license number to the

applicant and register the intermediary.

The deadline for checking documents and ruling on the application will be two weeks.

11 Reformed by Article 5 of the minutes of meeting 1221-2015 dated December 21, 2015. Published in La

Gaceta issue 13 dated January 20, 2016.

By that deadline, the Superintendency will assess the information that was submitted. If necessary, on a one-

time basis, the Superintendency may require the entity to respond to the observations. The deadline for the

ruling by SUGESE will be suspended for the period of time that it takes the entity to respond to the SUGESE's

observations.

The supervised entity will have a period of ten business days, which may be extended one time, to complete

the documentation and respond to the observations that are made.

If, during the verification and ruling period, the insurance entity or the insurance broker company becomes

aware of changes in the information revealed by the candidate in Paragraph VI of its affidavit, according to

Appendix 13 of these regulations, the entity must withdraw the application and file it again.

12Article 23. Intermediary Identification Formalities

Insurance entities and insurance broker companies must issue an identification document to the accredited

intermediaries. The document for the insurance agent or insurance broker must contain: name, identification

number; license number; issuance date; photograph and the expiration date. In addition, the back of the card

must have the following legend:

a) Insurance Agents:

"The insurance entities will be jointly and severally liable for any asset damages and prejudice caused

while they engage in the business that may affect the insureds, beneficiaries, or third parties through

fraudulent or wrongful actions by the insurance agents that make up its distribution network." Article

7, the Insurance Market Regulatory Law, Law 8653.

b) Insurance Brokers:

"The brokerage company will be directly liable for any damages and prejudice to any assets caused by

the company’s negligence or fraud while engaging in actions related to brokerage services and the

brokers that the company has accredited." Article 22, the Insurance Market Regulatory Law, Law 8653.

In addition, the previously indicated legends must include the following:

"The details about the branches and lines for which the intermediary is accredited will be available for look-up

at any time on the General Insurance Superintendency's web site."

12 Reformed by Article 5 of the minutes of meeting 1221-2015 dated December 21, 2015. Published in La Gaceta issue 13 dated January

20, 2016.

If the document is lost or stolen, individual agents must request that a copy be issued within a period of no

more than 10 business days after the event had occurred.

Article 24. Requirements for Authorization for Merging Supervised Entities

For authorization to merge an entity with another legal entity, the applicant must provide the

Superintendency with the information detailed in Appendix 6 of these regulations.

Article 25. Requirements for Authorization for Full or Partial Portfolio Transfer

For authorization for a full or partial portfolio transfer, the applicant must provide the Superintendency with

the information detailed in Appendix 7 of these regulations.

Article 26. Requirements for a Name Change for a Supervised Entity

For authorization to change the name of an insurance entity or an insurance broker company, the legal

representative must provide the Superintendency with the information listed in Appendix 8 of these

regulations.

Article 27. Requirements for Voluntary Cessation of Operations

When a supervised entity applies to voluntarily cease its insurance activities, it must attach the requirements

indicated in Appendix 9. The Superintendency must assess and inform the CONASSIF about the application

and the viability of the Activity Cessation Plan. After approving the application for cessation, the

Superintendency must check compliance with the Activity Cessation Plan and inform the CONASSIF about its

performance with the frequency that it establishes.

Article 28. Disclosure of Name Change for a Supervised Entity

When the Superintendency authorizes a change in name for a supervised entity, the entity must include the

phrase “Previously (the entity’s previous name)” on the stationery, advertising, and other forms of disclosure.

The period during which this phrase must be included will be defined by the ruling body in its communication

about the authorization and may not be less than 6 months.

ARTICLE 29. Requirements for Authorization for Changes to the Articles of Incorporation

For authorization to change the articles of incorporation for an insurance entity, the applicant must provide

the information listed in Appendix 10 of these regulations.

13ARTICLE 29 bis. Application for Mandatory Insurance Premium or Fee

The application for authorization for a mandatory insurance premium or fee, whether it is the initial or a

revised application after the fact, must provide the information that is listed in Appendix 23.

For authorization of a mandatory insurance fee, the applicant must provide the Superintendency with an

updated version of the technical note. If there have been any changes to the methodology, the applicant must

explicitly reveal any changes that have been incorporated. Otherwise, the applicant must state that the

methodology in the technical note has not been changed.

In conformity with the contents of Article 208 of the Labor Code and Article 44 of the Transit Law, the

mandatory insurance will be valid for one year. The amount of the premium or fees must be reviewed each

year by the insurance entities and, if pertinent, an application must be submitted for fee authorization to the

General Insurance Superintendency (SUGESE). If no changes are needed, the documents backing the annual

fee review must be made available to the SUGESE.

CHAPTER III

AREAS OF ANALYSIS AND CRITERIA FOR EVALUATING THE AUTHORIZATION APPLICATIONS

Article 30. Areas of Analysis

When the applications for authorization established in these regulations are being reviewed, the following

areas must be analyzed as pertinent:

a) Suitability of the shareholders;

b) The business project;

13 Added by Article 8, section 3 of the minutes of meeting 894-2010, held on December 10, 2010. Effective as of publication. La Gaceta

number 248 dated December 22, 2010.

c) The suitability of the address, administrative internal auditor, and the compliance officer;

d) Minimum capital;

e) The merger process;

f) The change in name;

g) Successive commitments.

Article 31. Criteria for Assessing the Shareholders’ Suitability

The criteria for assessing the shareholders' suitability are the following:

a) Economic Solvency: The shareholder must have net equity that covers the amount of capital

contributions that the shareholder must make to create a new entity.

b) Moral Standing: The legal and disciplinary track record of the shareholders with a relevant share in

the entity.

No authorization will be issued to create a new entity when any of the actions occur that are listed in Section

II, "Disciplinary and Judicial Background" in Appendix 12 of these regulations that are related to any

individual shareholders.

Article 32. Criteria to Assess the Business Project

The following are the criteria to use to assess the business project:

a) The Business Project: The business project must be reasonable for the characteristics of the target

market and the assumed market share is based on viable projections. The products that are forecast

must be outlined so the actuarial technical feasibility and its coherence with the financial forecast are

evident.

b) Financial Feasibility: The financial projections for a three-year horizon must evidence the operations’

continuity.

c) Equity Adequacy: The projected equity adequacy for a three-year horizon must evidence compliance

with the legal and regulatory stipulations.

d) Corporate Governability: Set of relationships between the entity's management, its Management Body,

its owners and other stakeholders, which provide the structure to establish the entity's objectives, the

form and means to achieve them and monitor their compliance. Corporate Governance defines the

manner in which authority is assigned and corporate decisions are made.14

e) Plan to Begin Activities: The activities to undertake to start up the entity must be coherent with its

business proposal.

f) Control and Surveillance: The internal auditing or surveillance committee must be independent in

relation to the entity’s administration. The internal auditor must be an employee of the entity who is

dedicated full time to carry out his or her functions. For cooperative insurance associations, the

internal auditor must be governed by section e) of Article 36 of the Cooperative Association Law.

g) Name: The name must clearly identify the type of license for the entity involved and make it possible to

tell the difference between the names of other authorized entities or entities in the authorization

process. In addition, the choice of words and expressions must match those reserved by law for

supervised entities.

i) Legal Domicile: The legal domicile must be the national territory or an international venue for entities

that are domiciled abroad.

15j) Regulator of Origin: Any insurance entity that is created based on the laws of another country that

operates in Costa Rica in the form of a branch and that is regulated in its jurisdiction of origin, must be

authorized to engage in the proposed operations and consolidate the operations. There must be an

agreement to exchange information in place between the Superintendency and the supervisor in the

country of origin.

16k) Risk Rating: An insurance entity (headquarters) created based on the laws of another country that

operates in Costa Rica in the form of a branch must have an international risk rating above BBB or the

equivalent that is issued by an internationally recognized risk rating company."

Article 33. Criteria for Assessing the Suitability of the Address, Administrative Internal Auditor, and

the Compliance Officer

When creating a new entity, the criteria for assessing the suitability of the board of directors or oversight

committee, the general manager, assistant general manager, the internal auditor, and the compliance officer

are the following:

14 Modified by CONASSIF through Article 12 of Meeting 1328-2017 of May 2, 2017 (Published in La Gaceta

107 on May 19, 2017.) 15 Added by Article 15 of the minutes of meeting 849-2010 dated April 30, 2010. Effective as of publication. La

Gaceta number 115, June 2010 16 Added by Article 15 of the minutes of meeting 849-2010 dated April 30, 2010. Effective as of publication. La

Gaceta number 115, June 2010.

a) Professional Qualification: The academic background, relevant professional experience and the job or

professional history must qualify the person to perform the position based on the business project.

b) Moral Standing: Legal and disciplinary background. When any of the actions detailed in Section IV,

“Disciplinary and Legal Background,” in Appendix 11 of these regulations take place within the

indicated period, it will be sufficient cause to reject the person as general manager, assistant general

manager, member of the board of directors or steering committee, internal auditor, or compliance

officer.

Article 34. Criteria to Assess Capital

The criteria to assess the entity's capital are the following:

a) Authorization for the Issue: When shares are placed on a formal market, the issue must have the

authorization of the pertinent market regulatory authority.

b) Capital Quality: The capital instruments must comply with the conditions to be considered to be part

of the capital stock. Shares acquired by a company in the same financial group or conglomerate will not

be accepted as capital stock by virtue of the instrument subscription and placement operation until the

shares are placed with third parties.

No entity may begin activities until it has the minimum capital fully subscribed and paid in cash in colones or

the equivalent in foreign currency. To check this, the capital must be deposited in the Central Bank of Costa

Rica and be available for withdrawal as the entity makes its investments.

If the entity needs to increase the minimum capital as a requirement for authorization to change the

company’s purpose, the capital stock will become part of the minimum capital. If there is any shortfall in

reaching the minimum capital, it must be paid in cash and deposited in the Central Bank of Costa Rica.

The reference purchase exchange rate set by the Central Bank of Costa Rica on the date when the deposit is

made must be used to find the equivalent amount in the national currency for the capital contributions made

in foreign currency.

Article 35. Criteria to Assess a Merger and Portfolio Transfer Process

The criteria to assess a merger and portfolio transfer process are the following:

a) Financial Feasibility: The financial forecasts for a three-year horizon must evidence operational

continuity for the resulting or prevailing entity and, as the case may be, for the entity that transfers the

portfolio and the entity that acquires the portfolio.

b) Equity Adequacy: The projected equity adequacy for a three-year horizon must evidence compliance

with the legal and regulatory stipulations by the resulting or prevailing entity and, as the case may be,

the entity that transfers the portfolio and the entity that acquires the portfolio.

c) Market Concentration: This must be in line with the criterion expressed by the Commission for the

Promotion of Competition.

d) Operational Feasibility: The integration operating plan or portfolio transfer must be appropriate.

Article 36. Criteria to Assess Changing the Entity’s Name

The criteria to assess changing the entity’s name are the following:

a) The name must clearly identify the type of license for the entity involved and make it possible to tell the

difference between the names of other authorized entities or entities in the authorization process. In

addition, the choice of words and expressions must match those reserved by law for supervised entities.

b) The name change plan in Appendix 8 to these regulations must be appropriate.

Article 37. Criteria to Assess Cessation of Insurance Activities

For applications for authorization to cease financial brokerage activities, the Cessation Plan referenced in

Appendix 9 of these regulations must ensure compliance with at least the following successor commitments:

a) Use of Reserved Terms: The proposed actions must guarantee compliance

with the legal provisions on the use of words and expressions that are reserved by law for supervised

entities.

b) Liabilities: The proposed mechanism must guarantee compliance with the liabilities to employees,

insurance companies and other creditors in the original conditions. This mechanism must be set up

through a Liability Management Contract with a Costa Rican financial brokerage supervised by the

SUGEF.

c) Liabilities with Insurance Companies and Beneficiaries: The proposed mechanism must guarantee

compliance with the liabilities or the transfer of contracts to another authorized entity.

d) Portfolio Transfer Plan: The required plan must be appropriate.

17Article 37 bis. Criteria for Assessing Cancellation of Mandatory Insurance Registration

The criteria for assessing applications for cancelling the registration for mandatory insurance as referenced in

Article 5 and Appendix 24 of these regulations are the following:

The Cessation Plan referenced in Appendix 24 of these regulations must consider the following:

a) Activity Cessation Plan: The requirements and disclosures established in Appendix 24 of these regulations

must be fulfilled. The submitted plan must guarantee compliance with at least the successor commitments

defined in sections b) and c) of this Article.

b) Liabilities to Insurance Companies and beneficiaries: The mechanism proposed to meet these liabilities

must ensure compliance with the liabilities under the original conditions. This mechanism must be

established by an appropriate, itemized disclosure of the liabilities and maintenance of the pertinent

provisions.

c) Portfolio Transfer Plan: The plan must comply with the assessment criteria defined in Article 35 and the

requirements set forth in Appendix 24.

Article 38. Criteria to Assess Changes to Articles of Incorporation

For applications for authorization to change the articles of incorporation, the following criteria will be

considered:

17 Reformed by Article 8, section 3, of the minutes of meeting 894-2010 held on December 10, 2010. Effective

as of publication. La Gaceta number 248 dated December 22, 2010.

a) Single Purpose Entity: According to the contents of Articles 7, 22, 47, and 48 of Law 8653.

b) Minimum Capital Required: The current requirement must be met.

c) Current Standards: The other minimum provisions required by the current standards must be met.

18Article 39. Criteria for Assessing Intermediary Accreditation and Licensing for Individuals

The criteria for assessing licensing for individuals are the following

a) Formal Requirements: Anybody who is applying for accreditation must be of legal age, and have at

least a high school diploma or its equivalent in the jurisdiction where compliance with the

requirement was accredited.

b) Training: The entity that accredits the individual must certify the technical skill to perform the

individual's functions in the accredited branches and commit to ongoing training for that individual

according to the contents of the Regulations on Insurance Commercialization.

c) Performance Limit: Must specify whether the agent will perform in the name or on account of the

insurance entity or just on the individual's own behalf.

d) Moral Standing: Legal and disciplinary background. When any of the actions listed in Section VI

"Disciplinary and Legal Background and Incompatibilities" in Appendix 13 of these regulations occur, it

will be held to be cause for the individual's accreditation as an insurance agent or broker to be

rejected. The same is true if the individual has been sanctioned by the Superintendency by cancelling

the license during the last five years or if it has been suspended during the period when the

application for accreditation is being assessed.

e) Accreditation: The individual must be accredited as an intermediary in the individual's

commercialization network by an insurance entity or an authorized brokerage company.

f) Relationship with the Entity: The exclusivity and binding relationships that the intermediary has

with the entity must be properly set forth in the applications in conformity with the definitions

established in Article 3 of the Regulations on Insurance Commercialization.

g) Incompatibilities and CONFLICTS of interest: The individual may not have any incompatibilities or

conflicts of interest as indicated in Article 20 of the Insurance Market Regulatory Law and in the

Regulations on Insurance Commercialization.

18 Reformed by Article 5 of the minutes of meeting 1221-2015 held on December 21, 2015. Published in la

Gaceta issue 13 dated January 20, 2016.

19Article 39 bis. Criteria for Assessing the Mandatory Insurance Premium and Fees

The criteria for assessing the mandatory insurance premium and fees referenced in Article 29 bis are the

following:

a) Fee Adequacy: The fee in the application must be adequate for covering the risk being subscribed to, the

administrative expenses, business expenses and other charges attributable to the insurance.

b) Fee Methodology: The technical note must define the premium calculation or risk fee, as well as other

components in the premium or business fee in compliance with the forms and disclosure required in

Appendix 23.

c) Document Formality: The documents sent must be signed by the actuarial and legal professionals

accredited by the applicant with the Superintendency according to the contents of Article 48 (Accreditation for

Professionals) of these regulations.

d) Filing Format: The disclosure forms for the parts of the premium or fee defined in Appendix 23 must be

followed.

CHAPTER IV

20DENIALS, SUSPENSIONS, AND CANCELLATIONS

Article 40. Authorization Denial

Any of the following situations will cause authorization to be denied:

a) When, after being warned based on these regulations, the applicant does not complete the

documentation.

b) When one or more documents filed for the authorization application have been declared to be false by a

legal authority.

c) When the information presented differs in relation to the information obtained from official sources by

the Superintendency.

d) When the assessment criteria described in these regulations are not met.

19 Added by Article 8, section 3 of the minutes of meeting 894-2010, held on December 10, 2010. Effective as

of publication. La Gaceta number 248 dated December 22, 2010. 20 The title of this Chapter IV was modified by means of Section II, paragraph 1 of the minutes of meeting 886-2010, Article 12, dated October 15, 2010. Published in La Gaceta number 217 on November 9, 2010. Effective

as of publication.

e) When the proposed appointment of a director, general manager, assistant general manager, internal

auditor or compliance officer has been rejected, but the applicant does not replace the appointment

within the period designated by the Superintendency.

Application denial entails the resources set forth in the General Public Administration Law without those

resources involving suspension of the act’s effects until a ruling has been issued.

21Article 41. Suspension and Cancellation of Authorization, Licensing, or Registration

After following the administrative procedure, the Superintendency may suspend or cancel the authorization,

licensing, or registration, as pertinent.

a. When an error is made by submitting documentation that is declared to be false by a judicial authority or

due to erroneous or deceitful information or when the authorized action does not match the true nature of

the events.

b. When the requirements for authorization, registration, and operations established by the pertinent legal

framework are breached.

Prior to suspension or cancellation, the Superintendency must take reasonable measures as necessary to

safeguard the interests of the insureds, beneficiaries, creditors and investors, and the National Financial

System's stability.

The resources contained in the General Public Administration Law are applicable to any suspension or

cancellation.

22ARTICLE 41 bis. Change of Status to Inactive, Suspension and Cancellation of the License and

Enrollment

The insurance entity or the insurance broker company must report to the Superintendency about any

insurance intermediaries, whether they are individuals or companies, that no longer belong to the distribution

channel, as well as any change in the intermediary's information in conformity with the general guidelines

issued by the Superintendent:

21 The text in article 41 was modified by Section II, paragraph 2, of the minutes of meeting 886-2010, Article

12, dated October 15, 2010. Published in La Gaceta number 217 dated November 9, 2010. Effective as of

publication 22 Reformed by Article 5 of the minutes of meeting 1221-2015 dated December 21, 2015. Published in La

Gaceta number 13 dated January 20, 2016.

Prior to the communication, the insurance entity or the insurance broker company, as pertinent, must adopt

reasonable measures as defined in the pertinent policies and procedures manual for insurance

commercialization or intermediation that are necessary to safeguard the interest of the clients helped by the

pertinent intermediary

If the insurance intermediary is not registered by another insurance entity or insurance broker company, the

intermediary's status will be changed to inactive. The Superintendency will keep a record of any intermediary

that is inactive until another insurance entity or insurance broker company, as pertinent, accredits the

intermediary again. This will apply to self-issuing insurance operators.

Any suspension or cancellation of the license and registration for insurance intermediaries and self-issued

insurance operators, as pertinent, will be performed by the Superintendent when any of the following causes

take place:

a. At the express request of the intermediary or self-issued insurance operator.

b. When the causes established in Article 41, section b) of these regulations occur.

c. Due to a sanction that imposes a cancellation.

The Superintendency will update the record on the web site:

a. Once the insurance entity or insurance broker company has updated and reported the changes made

to the Superintendency.

b. Once notification has been served of the ruling on suspending or cancelling the license or the final

accreditation and registration, as pertinent.

TITLE III

OTHER ADDITIONAL RECORDS

CHAPTER I

PROCEDURES FOR OTHER RECORDS

23Article 42. Mandatory Registration

In addition to the records defined in Article 19 of these regulations, the following records are mandatory:

a. Cross-border insurance commerce record:

i. - Insurance entities.

ii. - Re-insurance entities.

iii. - Intermediaries.

iv. - Auxiliary services.

b. - Requirements for records for self-issuing operators.

The requirements for the defined records are detailed in the appendices established for each case, which are

an integral part of these regulations.

APPENDIX 18. Requirements for registering cross-border insurance vendors.

APPENDIX 19. Requirements for registering representative offices.

APPENDIX 21. Form for registering self-issued insurance operators.

APPENDIX 22. Registering mandatory insurance.

24Article 42 Bis. Parity Contracts or Free Discussion Contracts. (Repealed by paragraph 2, Article 9 of minutes of meeting 1131-2014, held on October 27, 2014, published in La Gaceta number 228 on November 26, 2014)

Insurance entities may only subscribe to parity insurance contracts in the general insurance category and

when the following conditions have come together:

1. The insurance policy holder must be an economic agent that is a company.

2. The insurance must fall into one of the following branches:

a. Marine vehicles

b. Aviation

c. Railroad cars

d. Transported merchandise

e. Fire and associated lines

23 Modified by section 4, Article 9 of the minutes of meeting 1131-2014, held on October 27, 2014, published

in La Gaceta number 228 on November 26, 2014. 24 Repealed by section 2, Article 9 of the minutes of meeting 1131-2014, held on October 27, 2014, published

in La Gaceta number 228 on November 26, 2014.

f. Civil liability

3. The entity must have mass products or contract types registered in the same branch of insurance as the

parity contract that will be signed. An exception to this condition are contracts that cover the risks indicated in sections a, b, and c of the preceding paragraph.

4. The contract's annual premium amount must be greater than or equal to 200,000 development units.

To verify the minimum amount set forth in section 4 of this Article for contracts in a currency other than the Costa Rican colon, the conversion factors published by the Central Bank of Costa Rica on the date the

contract is signed must be used. United States dollars will be converted at the purchase exchange rate

published by the Central Bank of Costa Rica on that same date.

Parity contracts are not subject to the registration process with the Superintendency. All parity insurance

contracts must bear the following legend:

"The terms and conditions in this insurance contract were freely negotiated by the insurer and the economic

agent holding this policy."

25Article 42 ter. Parity or Free Discussion Contracts

"When an insurance entity places products using the procurement mode, it must send the following

information to the Superintendency:

1. The insurance policy holder's name and corporate identification number

2. Insured amount

3. Seasonality

4. Business premium amount or percentage

5. Risk premium amount or percentage

6. Risk reinsurer name and rating. If the risk is not reinsured, it must be indicated

7. Risk assignment percentage

8. Deductible amount or percentage If there is no deductible, it must be indicated

9. Co-insurance amount or percentage. If there is no co-insurance, it must be indicated

10. Co-payment amount or percentage. If there are no co-payments, it must be indicated

The Superintendent, by means of a generally applicable agreement, will establish the frequency, terms and

means of sending the information in the parity or free discussion contracts that must be sent to the insurance

entities.

In addition, the insurance entity must document the methodology for determining the premium and make it

available to the Superintendency for the pertinent supervision work.

26Article 43. The Application Process

To process the registration applications, the contents of Articles 4, 6, 7, 8, 9, 10, and 11 of these regulations

must be followed.

25 Added by Article 9 of the minutes of meeting 986-2012, held on July 31, 2012. Effective as of publication. La Gaceta, number 172, dated September 6, 2012. 26 Modified by section 5, Article 9 of the minutes of meeting 1131-2014, held on October 27, 2014, published

in La Gaceta number 228 on November 26, 2014.

Article 44. Registration Communication

Once the requirements or deadlines established by the Superintendency have been met, the registration will

be reported to the applicant.

Article 45. Denial of Registration

Any of the following situations will lead to registration suspension:

a) When, after being warned based on these regulations, the applicant does not complete the

documentation.

b) When one or more documents filed for the authorization application have been declared to be false by a

legal authority.

c) When the information presented differs in relation to the information obtained from official sources by

the Superintendency.

Application denial entails the resources set forth in the General Public Administration Law without those

resources involving suspension of the action’s effects until a ruling has been issued.

Article 46. Suspension of Registration

Any of the following situations will lead to registration suspension:

a) When there is an error in the form of presentation of false documentation as declared by a legal

authority or due to erroneous or deceitful information or when the authorized act does not line up with

the true nature of the facts.

b) When the information presented differs in relation to the information obtained from official sources by

the Superintendency.

c) When the causes for suspension or exclusion of the registration established in the applicable legal

framework occur.

d) When the authorization that caused the record to be added is revoked.

e) Due to a well-founded ruling by the Superintendency within thirty business days

after finalizing the application for registration based on the contents of Article 29, section d) of the

Insurance Market Regulatory Law, for Insurance Policy Types.

Prior to suspension or exclusion, the Superintendency must take reasonable measures as necessary to

safeguard the interests of the insureds and beneficiaries and the National Financial System's stability.

Revocation entails the resources set forth in the General Public Administration Law without those resources

involving suspension of the effects of the action until they have been solved.

CHAPTER II

27REGISTERING MANDATORY INSURANCE

28Article 47. Requirements for Registration Application (Repealed by section 2, Article 9 of the minutes of

meeting 1131-2014, held on October 27, 2014, published in La Gaceta number 228 on November 26, 2014.)

The Policy Type and Technical Note will be registered by the insurance branch as defined in Appendix 1 of

these regulations. When the entity applies for the registration of the Policy Type and the Technical Note, the

entity must fulfill the requirements indicated in Appendix 15.

The Superintendent may require, by means of a general provision, that the application be submitted

electronically. The Superintendent may define criteria for service of notification of minor changes in the Policy

Type or the Technical Note and for the records to be updated. The Superintendent will send a quarterly report

to the CONASSIF about the policies added to the record as well as exclusions for the period.

29Article 47 bis. Requirements for the Application for Registration of a Mandatory Insurance Product

and the Initial Fee

27 Modified by section 6, Article 9 of the minutes of meeting 1131-2014, held on October 27, 2014, published in La Gaceta number 228 dated November 26, 2014. 28 Repealed by section 2, Article 9 of the minutes of meeting 1131-2014, held on October 27, 2014, published

in La Gaceta number 228 on November 26, 2014. 29 Added by Article 8, section 3 of the minutes of meeting 894-2010, held on December 10, 2010. Effective as

of publication. La Gaceta number 248 dated December 22, 2010.

When the entity applies for registration of mandatory insurance, the requirements indicated in Appendix 22

must be met. An application for premium or fee as established in Article 29 bis of these regulations must be

attached to the registration application.

The following items will be considered to be criteria for assessing the registration:

a) The existence of clear, transparent, simple procedures for accessing the insurance benefits in conformity

with the contents of the Labor Code and the Transit Law, as pertinent.

b) The technical standards for insurance for MWC must be clear and have the minimum contents indicated

in the standards.

c) The premium or fee estimation methodology must be appropriate and fulfill the requirements defined in

Appendix 22.

The Superintendent may require, by means of a general provision, that the application be submitted

electronically. The Superintendent may also define criteria for service of notification of minor changes in the

Policy Type, Insurance Standards, or the Technical Note and for the records to be updated.

30Article 48. Accreditation of professionals (Repealed by section 2, Article 9 of the minutes of meeting 1131-

2014, held on October 27, 2014, published in La Gaceta number 228 on November 26, 2014.)

The insurance entity must accredit actuarial and legal professionals who are able to sign the documents

required for registering policy types. Therefore, the requirements established in Appendix 16 must be met.

31Article 49. Registration finalization. (Repealed by section 2, Article 9 of the minutes of meeting 1131-2014,

held on October 27, 2014, published in La Gaceta number 228 on November 26, 2014.

Policies being registered will be finalized once the missing information has been completed that was reported,

according to the contents of Article 6 or within a period of 15 business days, if no notification is served. Once

the application for registration is finalized, the authorized insurance entities may, at their own risk, sell and

advertise the product according to the contents of Article 25, section k) and Article 29, section d) of the

Insurance Market Regulatory Law.

32Article 50. Product suspension (Repealed by section 2, Article 9 of the minutes of meeting 1131-2014, held

on October 27, 2014, published in La Gaceta number 228 on November 26, 2014.)

30 Repealed by section 2, Article 9, of the minutes of meeting 1131-2014, held on October 27, 2014, published

in La Gaceta number 228 on November 26, 2014 31 Repealed by section 2, Article 9, of the minutes of meeting 1131-2014, held on October 27, 2014, published

in La Gaceta number 228 on November 26, 2014 32 Repealed by section 2, Article 9, of the minutes of meeting 1131-2014, held on October 27, 2014, published

in La Gaceta number 228 on November 26, 2014

When, in conformity with section d) of Article 29 of Law 8653, some observation or request for modification is

forthcoming that implies suspending product registration, the entity that was notified must stop offering the

product and contract it out within a maximum period of five business days after receipt of the suspension

notification.

When a product is suspended, the entity will have a period of 60 business days after notification of the

suspension to correct any irregularities reported in the notification. Once the deadline has passed without

any corrections being made, the registration will be revoked.

If a product registration is suspended or revoked when the product is a replacement for another product that was previously registered and that registration was cancelled by virtue of the new process, the replaced

product will be automatically reinstated and may be offered to the public while the entity sends the

suspended product out for correction.

A product registration suspension or revocation will take effect in the future and all the pledges made in the

past must be observed by the insurance entity with the adjustments announced by the Superintendency so

long as they benefit the insured.

33Article 51. Auxiliary Services Related to the Policy (Repealed by section 2, Article 9 of the minutes of meeting 1131-2014, held on October 27, 2014, published in La Gaceta number 228 on November 26, 2014.)

If the registered Policy Type limits the auxiliary service providers related to the product when they provide a

direct service to the insured or beneficiary, the insurance entity must reveal the conditions in the contractual

documentation to have access to providing the offered service, as well as how the policy holder, the insured or

the beneficiary of an insurance policy may obtain updated information about the auxiliary providers at any

time. CHAPTER III

CROSS-BORDER PROVIDERS AND REPRESENTATIVE OFFICES

Article 52. Cross-border providers

The insurance service providers in a country with which Costa Rica has made commitments to allow cross-

border trade by means of subscribing to an international treaty that is in place, they must register with the

Superintendency first to be able to supply their services in the national territory.

The requirements for registration are defined in Appendix 18 of these regulations and will be applied to the degree that the current international treaty allows the mode referenced in the requirements. This will be verified case by case by the Superintendency.

.

33 Repealed by section 2, Article 9, of the minutes of meeting 1131-2014, held on October 27, 2014, published

in La Gaceta issue 228 dated November 26, 2014.

Registration does not imply authorization for make a public offering or to do business in the country under

the terms of Article 3 of Law 8653. The insurance products sold cross-border will require the policy to be

registered.

When dealing with reinsurance or retrocession services, how they are brokered and their auxiliary services

may be procured through cross-border trade in any case, regardless of whether or not specific pledges exist in

an international treaty. If said services are procured directly by the insurance entities, registration will not be

required. The insurance entities will report to the Superintendency based on the terms of the solvency regulations, guarantees, and the details about the required information for reinsurance and retrocession

operations.

Article 53. Representative Offices

In conformity with the contents of the Law, representative offices may be established for insurance or reinsurance providers abroad.

The Superintendency will keep a record of the representative offices that are established in the national

territory. If there is proof that a representative office is doing a public offering or carrying out insurance

business, it may give rise to it being removed from registration without prejudice to any applicable sanctions.

The registration requirements for representative offices are defined in Appendix 19.

TITLE IV

MINIMUM OPERATING REQUIREMENTS

Article 54. General Governance Requirements34

Insurance and reinsurance entities must have a corporate governance system that allows healthy and prudent management of their activities, aligned with the principles and rules contained in the regulations on

corporate governance and risk management that are binding upon it, which must be documented as part of

the authorization process of the entity.

The design and implementation of the entity's Corporate Governance System must take into account its

particular attributes in aspects such as: the laws that are applicable to it, size, ownership structure and legal nature, scope and complexity of its operations, the corporate strategy, the Risk Profile and the potential

impact of its operations on third parties.

34 Modified by CONASSIF through Article 12 of Meeting 1328-2017 of May 2, 2017 (Published in La Gaceta

107 on May 19, 2017.)

Article 55. Risk rating

The insurance company must keep the risk rating updated. The first rating must be issued within a maximum period of 18 months after the date that the letter of compliance with final authorization

requirements is received. After that, it must be updated at least once each year. Any changes in the rating or

outlook must be reported to the market as a relevant event.

Article 56. Contracting with Third Parties

Critical operating functions may not be performed by a third party if any of the following situations occur:

a) Sensitive prejudice to the quality of the entity's governance system.

b) Substantial increase in operating risk.

c) Impairment of the Superintendency's capacity to handle its functions. All the contracts must stipulate

unrestricted access by the Superintendency to the operating information for the entity that is involved.

d) Restraint on service continuity and satisfaction.

The insurance entities will report to the Superintendency about any critical activity that is contracted out to a

third party. Likewise, they will report any later significant change related to said activities.

Article 57. Conflict of interest (Repealed by CONASSIF through Article 12 of Meeting 1328-2017 on May 2, 2017 – Published in La Gaceta 107 on

May 19, 2017.)

The governing body for the insurance entity must approve policies about handling conflicts of interest and incompatibilities. The policies must be available to the public and must include, as a minimum, conflicts about:

a) Transactions between the entity and other entities in the same economic group.

b) Activities performed by the entity's functionaries and directors in relation to the insurers or reinsurers,

intermediaries, or providers of auxiliary services.

c) Any insurance contracts with the entity's directors, stockholders, and employees and any insurance contracts with

the directors or shareholders of companies in the same group.

Any other situations that may be determined by the governing body.

Article 58. Comprehensive Risk Management System (Repealed by CONASSIF through Article 12 of Meeting 1328-2017 on May 2, 2017 – Published in La

Gaceta 107 on May 19, 2017.)

Insurance entities will have a comprehensive risk management system available that will encompass the information

strategies, processes, and procedures needed to identify, estimate, manage, and control risks inherent to the business. The risk management system will be integrated with the insurance or reinsurance entity’s organizational structure. It will encompass business continuity plans and will be documented by a policies and procedures manual for comprehensive risk management. The manual must be approved by the entity's governing body and will be reviewed at least annually. It will contain as a minimum the contents of Appendix 14.

Article 59. Risk Committees and Asset and Liability Committee (Repealed by CONASSIF through Article 12 of Meeting 1328-2017 on May 2, 2017 – Published in

La Gaceta 107 on May 19, 2017.)

The entity must create a risk committee in charge of monitoring the comprehensive risk management system and an asset and liability committee in charge of monitoring the entity's asset and liability management policy. Both committees will be

appointed by the governing body. The committees must meet at least once each month. The entity will keep track of motions passed by the committees in a minutes book for each meeting. The Superintendent may create, as a general provision, an electronic minutes book. The minutes book, as well as the information used to back the decisions, must be kept available to the Superintendency.

Article 60. Risk management (Repealed by CONASSIF through Article 12 of Meeting 1328-2017 on May 2, 2017 – Published in La Gaceta 107 on

May 19, 2017.)

The risk management system will encompass, as a minimum, the relevant risks for the capital adequacy and solvency

calculation according to the pertinent regulations. The system will cover, as a minimum, the following areas:

a) Technical provision subscription and creation.

b) Asset and liability management.

c) Investments.

d) Liquidity, liability/asset mismatch, and concentration risk management

e) Reinsurance and other risk reduction techniques.

f) Compliance with the capital requirement.

Article 61. Risk and Solvency Self-evaluation (Repealed by CONASSIF through Article 12 of Meeting 1328-2017 on May 2, 2017 – Published in La Gaceta 107 on May 19, 2017.)

Insurance entities must perform periodic self-evaluation exercises for risk and solvency. The evaluation should

encompass, as a minimum, the following:

a) The overall solvency needs considering the specific risk profile, the approved risk tolerance limits, and the entity's

business strategy.

b) Ongoing compliance with the forecast capital requirements and requirements related to technical provisions in

these regulations.

c) The risk and solvency self-evaluation will be an integral part of the business strategy and will continually be taken

into account in the company's strategic decisions.

d) Insurance entities will perform the evaluation immediately when there is any significant change in its risk profile.

The results of each risk and solvency self-evaluation will be reported to the Superintendency along with corrective plans,

as the case may be.

Article 62. Internal Control (Repealed by CONASSIF through Article 12 of Meeting 1328-2017 on May 2, 2017 – Published in La Gaceta 107 on

May 19, 2017.)

Insurance entities must establish an effective internal control system. The system must contain, as a minimum,

administrative and accounting procedures, an internal control framework, appropriate information mechanisms at all

company levels and an ongoing compliance checking function.

The internal auditing function will consist of examining conformity with the entity's activities with all its internal

information strategies, processes and procedures. It will also include checking whether the company's internal control

system is sufficient and adequate for the activity level. The function must be objective and independent of the operating

functions.

The internal auditor must be appointed by the entity's governing body. The auditor appointment and requirements must

be documented by the Superintendency and, if the auditor resigns or is discharged, the Superintendency must also be

informed.

Each year, or as frequently as indicated by the Superintendent, the insurance company's internal auditors will submit

reports to the Superintendency as required.

Article 63. Actuarial Function (Repealed by CONASSIF through Article 12 of Meeting 1328-2017 on May 2, 2017 – Published in La Gaceta 107 on May 19, 2017.)

Insurance and reinsurance entities will have an effective actuarial function that will be in charge of:

a) Coordinating the technical provision calculation.

b) Reviewing the adequacy of the methodologies, models, and assumptions used in calculating the technical

provisions.

c) Evaluating the adequacy and quality of the data used in the technical provision calculation.

d) Quoting the best estimates with previous experience.

e) Reporting to the governing body about how reliable and adequate the technical provision calculation is.

f) Supervising the technical provision calculation.

g) Pronouncing on the general subscription policy.

h) Pronouncing on the adequacy of the reinsurance agreements.

i) Contributing to the effective application of the risk management system, in particular for the risk modeling used as

a basis for calculating the capital and self-evaluation requirements.

j) Determining the rate models for each product and the technical notes.

k) Checking the quality and adequacy of the statistical information required as input for performing their functions.

The actuarial function must be performed by people with sufficient knowledge of actuarial and financial mathematics.

They must substantiate their experience and expertise in relation to the applicable professional standards.

TITLE V

FINAL PROVISIONS

35Article 64. Competence for Ruling on Applications

The Superintendent is competent for hearing and ruling on the authorizations that are established in these

regulations. Nevertheless, the Intendent is competent for issuing authorizations and denying extensions to the deadlines as provided for in the regulations.

Extensions will be allowed so long as the company asks for the extension on time with justification.

The Superintendent must provide a quarterly report to the Council about authorizations given, about the

denied applications and the reason for the denial, as well as the applications that are filed.

36Article 65. Document Custody

Insurance entities and brokerage companies must keep documentation about their operations for a minimum

period of five years and, for long-term policies such as life and civil liability for ten years. Physical

documentation may be kept at the fiscal domicile in an appropriate filing site, but it will not release the entity

of its custody responsibility and, as a consequence, of its obligation to ensure that the documentation is kept

in good shape and safe and that there is access.

In any case, the information must be available when the Superintendency needs it at the supervised entity's fiscal domicile within a maximum period of one business day."

35 Reformed by Article 5 of the minutes of meeting 1221-2015 dated December 21, 2015. Published in La Gaceta number 13 dated January 20, 2016. 36 Modified by Article 15 of the minutes of meeting 849-2010 dated April 30, 2010. Effective as of publication.

La Gaceta number 115, June 2010.

TITLE VI

TRANSITORY RULES OF LAW

CHAPTER I

TRANSITORY RULES OF LAW

37Transitory Rule of Law I

When these regulations take effect, any insurance entities that are selling products must keep a copy that is printed, filmed, or taped using magnetic or optical media of the technical notes and contractual

documentation of the current plans prior to the issuance of these standards. To adjust to the required forms

and register the technical notes, a deadline ending on February 28, 2010, will be provided."

To take effect as of December 24, 2009.

Transitory Rule of Law II

Insurance entities must accredit, according to the contents of these regulations, the insurance agents and

agency companies in their distribution channel within a maximum period of three months.

For the purposes of Transitory Rule of Law IX of Law 8653, accredited companies that must change their

name must process the change in conformity with the contents of Appendix 9 (authorization for a supervised

entity to change its name).

Transitory Rule of Law III.

In conformity with motions passed by the National Financial System Supervisory Council,

37 Reformed by Article 8 of the minutes of meeting 805-2009, dated September 11, 2009. La Gaceta number

186 dated September 24, 2009. Effective as of publication in the La Gaceta official journal. Modified by Article 6 of the minutes of meeting 825-2009, dated December 23, 2009. To take effect as of

December 24, 2009. Published in La Gaceta number 11 dated January 18, 2010.

Article 6 of the minutes of meeting 732-2008 dated July 31, 2008, and during the General Insurance

Superintendency's function-based surcharge period in the Pension Superintendency, for the purposes of

these regulations, any reference to the powers wielded by the Superintendency or the Superintendent refers to

the Superintendency or the Pension Superintendent.

38Transitory Rule of Law IV

Insurance entities must begin to update all the products that they sell, such as model contracts or parity contracts in conformity with the contents of these regulations within one month after this document takes

effect. The insurance company must send, along with the applications, the new general conditions, a matrix

with the changes and a statement where they indicate that the rest of the registered information has not been

modified.

For products sold as model contracts that, when these provisions take effect, are registered with the

Superintendency, the entity must state that they fully match the provisions contained in these regulations or,

in the absence thereof, they must make the modifications referenced in this Transitory Rule of Law provision

by the deadline indicated in the preceding paragraph.

Effective Period

The regulations will take effect as of publication in the “La Gaceta” Official Journal.

38 Added by Article 9 of the minutes of meeting 986-2012, held on July 31, 2012. Effective as of publication.

La Gaceta number 172 dated September 6, 2012.

39APPENDIX 1

DEFINITION OF INSURANCE CATEGORIES, BRANCHES AND LINES.

A. Insurance Categories

a. - General Insurance: This insurance category groups together the insurance policies related to the risk of loss or damage to things, plants, animals, or assets.

b. - Personal Insurance: This insurance category groups together insurance policies related to life, physical wholeness and health for people.

Insurance entities may specialize in the general or personal category. They may also be mixed entities.

Whatever their specialization may be, the entity may offer mandatory insurance. However, the books must be

kept separately for each insurance category and for each type of mandatory insurance.

B. Branches and Lines

The insurance categories are made up of more specific groupings of risks of a similar nature called branches.

In turn, the branches are made up of insurance lines.

The specific products may have a name that is different from the lines with which they are associated. A

single product may group together various authorized lines and branches, even from different categories.

1. The general insurance category is made up of the following branches and lines:

a. - Automobile: Includes any damage caused to:

i) Motorized land vehicles.

ii) Non-motorized land vehicles.

b. - Marine Vehicles: Includes any damage caused to:

i) Marine vehicles

39 Modified by section 7, Article 9 of the minutes of meeting 1131-2014, held on October 27, 2014, published

in La Gaceta number 228 on November 26, 2014.

ii) Lake-enabled vehicles.

iii) Water-borne vehicles.

c. Aviation: Includes any damage caused to airborne vehicles

d. Railroad Vehicles: Includes any damage caused to railroad vehicles.

e. Transported Merchandise: (including merchandise, luggage and other goods): Includes any damage

caused to transported merchandise or luggage, no matter what the means of transportation may be.

f. Fire and Associated Lines: Any damage caused to goods other than those included in branches a,

b, c, d, and e, that is caused by fire, explosions, storms and other natural elements, nuclear energy,

and land sinking. Includes the following lines:

i) Industrial fire

ii) Business fire

iii) Home fire

iv) Catastrophic coverage for natural phenomena

g. Other Property Damage: Includes any damage caused to goods other than those included in

branches, a, b, c, d, and f, and the prejudice that is caused by robbery, loss, theft, accidental

destruction, malicious damages, terrorism, vandalism, machinery breaking down or machinery or

equipment malfunctioning, smoke, water coming from broken pipes, overflows caused by non-natural

elements, business interruption, etc. Includes the following lines:

i) Construction

ii) Securities

iii) Robbery

iv) Machinery or equipment

v) Cards

vi) Misc.

h. Civil liability: Including:

i) General civil liability.

ii) Civil liability, including the carrier, resulting from using automotive land vehicles, railroad

vehicles, airborne vehicles, marine vehicles, lake-enabled vehicles, water-borne vehicles, as well

as any liability other than the aforementioned liability types.

i. Credit:

i) General insolvency.

ii) Export credit.

iii) Installment sales.

iv) Mortgage loans.

v) Agricultural loans.

j. Bonds:

i) Direct bonds.

ii) Indirect bonds.

k. Monetary losses:

i) Risk of loss of employment.

ii) Insufficient income.

iii) Loss of benefits.

iv) Ongoing general expenses.

v) Diverse business expenses.

vi) Loss of market value.

vii) Loss of leases or income.

viii) Other monetary losses.

l. Agricultural and livestock: Includes damages and prejudice related to crops, harvests, animal and

other similar types of production.

m. Legal defense.

n. Mandatory automobile insurance.

o. General branch assistance insurance.

2. The personal insurance category is made up of the following branches and lines:

a) Life: Includes insurance on life, death, or mixed. It includes the following lines:

i) Self-issued life

ii) Regular life

iii) Temporary life older than 1 year

iv) Temporary life younger than or 1 year old

v) Balance owed

vi) Universal life

b) Income: Includes capitalization operations based on an actuarial technique that assumes a change

in the one-time or periodic payments set in advance and determined commitments related to their

duration and amount. Includes the annuities derived from Law 7983. Includes the following lines:

i) Non-projected annuities

ii) Projected annuities

iii) Temporary income more than one year

c) Accidents: Includes the following lines:

i) Accidental death

ii) Accidental disability

iii) Repatriation of mortal remains

iv) Funeral expenses

v) Coverage for vehicle occupants

vi) Voluntary accident and on-the-job disability insurance

d) Health: Includes the following lines:

i) Serious illnesses

ii) Disability due to illness

iii) Medical expenses

iv) Voluntary professional illness insurance

v) Income due to hospitalization

e) Mandatory workers' compensation insurance (MWC)

f) Personal branch assistance insurance

g) The types of insurance as provided for in letters a) and b) that are associated with investment

funds. Includes the following lines:

i) Life products associated with investment funds

ii) Income products associated with investment funds

C. Accessory Risks

Coverage may be provided for additional risks included in another branch and category without needing to

obtain specific authorization even when the insurance entity only has a license to operate in a different

category so long as the main risk belongs to a branch and category that is authorized for that entity and it

complies with the following:

a) They are associated with the main risk.

b) They refer to the object covered against the main risk.

c) They are covered by the contract that covers the main risk.

Nevertheless, the risks included in the credit and bond branch of the general insurance category may not be

considered to be accessories to other branches.

APPENDIX 2

INSURANCE ENTITY AUTHORIZATION

Documentation required for authorization for incorporation and to begin activities.

I. LEGAL BASIS

A. THE CODE OF COMMERCE OF COSTA RICA

For construction and organization: Chapters 3 and 7 of Title I, Book I.

B. INSURANCE AND REINSURANCE ENTITIES (INSURANCE MARKET REGULATORY LAW, LAW

8653).

1. For creation: Articles 7, 8, 9, and 25.

2. For name: Article 20, section b.

3. For Boards of Directors: Article 9.

4. For regulations: Article 20, section b.

5. For administration and internal organization: Article 25, sections m, n, s, and v.

6. For minimum capital: Article 11.

7. Insurance cooperatives: Articles 7 and 48. 40II. DOCUMENTATION THAT MUST ACCOMPANY THE APPLICATION FOR THE CREATION OF A NEW

INSURANCE ENTITY.

40 Modified by Article 15 of the minutes of meeting 849-2010 dated April 30, 2010. Effective as of publication. La Gaceta

number 115, dated June 15, 2010.

41A. GENERAL INFORMATION

Entities to be created in Costa Rica

1. A letter requesting authorization to create a new entity signed by the applicant or the

applicant’s legal representative. The signature must be authenticated by a notary public.

The letter must indicate the proposed name for the entity (it must be a name that will not

cause confusion for consumers about another insurance entity in operation; this is checked

by the Superintendency) and an address, fax number and email for service of notifications.

2. When the applicant is acting in the name of a company, in addition to providing the legal

entity certification that states the power to act for the applicant’s legal representative, it

must be issued by the Public Registry, by a notary public, or by the competent authority. If

the party filing the application does so based on a proxy issued by the applicant, it must

have been issued in the presence of a notary public and must come with a certified copy. No

document may be more than three months old.

3. A copy of the deed to create the company.

Branches of entities created based on the laws of other countries.

1. A letter requesting authorization to create a branch signed by the legal representative of the

applicant entity. The signature must be authenticated by a notary public. The letter must

indicate an address, fax number, and email for acceptance of service of notifications.

2. Certification that the applicant entity is in existence as a legal entity. The certifications must

substantiate the legal representative's capacity to act. It must be issued by the foreign entity

that is a peer of the Public Registry, by a notary public or the competent authority. If the

party filing the application does so based on a proxy issued by the entity or applicant, it

must have been issued in the presence of a notary public and must come with a certified

copy.

3. A letter issued by the competent authority indicating that the applicant entity is supervised

in its jurisdiction of origin and is authorized to perform the proposed operations. Afterward,

the supervisory report must be provided.

4. International risk rate for the current applicant entity issued by a risk rating company that

is recognized internationally, attaching the basis for the rating that was obtained.

41 Modified by Article 15 of the minutes of meeting 849-2010 held on April 30, 2010. Effective as of

publication. La Gaceta number 115, dated June 15, 2010.

5. Certified copy of the applicant entity's current articles of incorporation.

6. Certification issued by a certified public accountant about the amount of the capital stock

that is subscribed to and paid for and the number of shares in the applicant entity issued

within six months prior to the date that the application was filed.

7. Express written authorization from the applicant entity's legal representative that gives the

Superintendency and the supervisor or regulator of origin permission to investigate the

company's operations in any domestic and/or international office or organization. The

authorization must be open ended for up to two years after the branch being applied for

ends its operations. In addition, the regulator of origin and the Superintendency must be

authorized to exchange and share all the information that either of the regulators may

request from the other regulator. The legal representative’s signature must be authenticated

by a notary public.

8. Written authorization for the legal representative of each of the companies in which the

applicant entity owns 50% or more of the capital stock, empowering the responsible

supervisory organization to investigate the companies at any domestic and/or international

office or organization. The legal representative’s signature must be authenticated by a

notary public.

9. Complete audited financial statements for the applicant entity, prepared based on the

International Accounting Standards or US GAAP for the period ending immediately prior to

the date the application was filed. The financial statements must be audited by an

authorized public accountant or the equivalent professional in the country where they are

issued.

10. A copy of the deed to create the branch.

B. INFORMATION ABOUT OWNERSHIP STRUCTURE

Individual shareholders

1. A detailed list with the full name, nationality and permanent residence of the individual

shareholders.

2. Certified copy from a notary public of the identification document for the person (both sides of

the ID card if the person is Costa Rican or the passport if the person is foreign).

3. Resume and police report. The signature must be authenticated by a notary public.

4. Three references about honorability and financial solvency.

5. A sworn statement in relation to the public deed, according to Appendix 12.

6. Certification of criminal background issued by the competent public organization in the

country of nationality and from the country of residence for the last five years.42

7. Written authorization for an individual empowering the responsible supervisory organization to

investigate the companies at any domestic or international office or organization. The signature

must be authenticated by a notary public.

8. Written authorization for the legal representative of each of the companies in which the

individual owns 50% or more of the capital stock, empowering the responsible supervisory

organization to investigate the companies at any domestic or international office or

organization. The legal representative’s signature must be authenticated by a notary public.

9. An equity statement for the individual, including an itemization of assets and liabilities, issued

within six months prior to the application being filed, signed by the interested party and

certified by an authorized public accountant or an equivalent professional in the country where

it is issued.

10. A sworn statement entered into a notary's protocol book about the source of the funds that

specifies if financing is involved, in which case it should indicate the name of the lender, the

amount and the financing conditions.

Corporate shareholders

1. Detailed list with the full name, corporate identification number and legal domicile of the

company shareholders.

2. List with the full name, nationality and identification of the permanent domicile of each of the

shareholders in that company.

3. Certification issued by a notary public or by the competent authority that contains the number

of the shareholders up to the level of the individual, ID card number (or passport), description

and share in the capital stock.

4. List with the full name, nationality, and indication of

42 Modified by Section II, paragraph 1, section d) of the minutes of meeting number 1043-2013 held on May

21, 2013. Effective as of publication. La Gaceta number 115, dated June 17, 2013.

permanent domicile of each of the members of the Board of Directors, Administrative Council

or the organization with equivalent functions for the company.

5. Certification of legal entity status issued by the Public Registry or its peer abroad.

6. Certification issued by a certified public accountant about the amount of the capital stock that

is subscribed to and paid for and the number of shares in the company issued within six

months prior to the date that the application was filed and a certified copy of the articles of

incorporation.

7. Written authorization for the legal representative of each of the companies in which the party

owns 50% or more of the capital stock, empowering the responsible supervisory organization to

investigate the companies at any domestic and/or international office or organization. The legal

representative’s signature must be authenticated by a notary public.

8. The signature must be authenticated by a notary public.

9. Complete audited financial statements for the corporation, prepared based on the International

Accounting Standards or US GAAP for the period ending immediately prior to the date the

application was filed. The financial statements must be audited by an authorized public

accountant or the equivalent professional in the country where they are issued.

C. THE BUSINESS PROJECT

The business project report should contain at least the following information:

Business Proposal

a) The project’s background and the reason for carrying out the insurance activities in Costa

Rican territory.

b) A description of the products and services that the entity projects offering. Specify the

insurance lines for which authorization is being requested as described in Appendix 1.

c) A description of the project’s critical success factors.

d) A description of the sources of financing.

e) Features of the target market.

f) An analysis of the strengths, opportunities, weaknesses, and threats.

g) An indication of the current and estimated market share for at least three years for the main

products and services that the entity intends to offer.

Accounting and information systems

a) A description of the information systems for identifying, managing and tracking business risk.

b) Strengths and weaknesses as they relate to the internal control and management information

systems.

Financial information

a) Pro forma financial statements including the trial balance and the profit and loss statement for

the first three years of operation. The main assumptions and the asset categories used must be

identified and justified.

b) Audited consolidated financial statements for the last fiscal period for the international

conglomerate to which the company belongs.

c) Annual financial projections for the first three years of operation, an estimate of the time period

to reach the break-even point, and an indication of the sources of financing.

d) Projection of organizational expense and installation amortization.

43e) Calculation and analysis of the projected indicators in the current solvency model and

adequacy of the asset requirements for the first 12 months.

f) Main risk identification and analysis (market, credit, interest rate, exchange rate, image,

liquidity, technique), applying sensitization scenarios to the financial projections.

43 Modified by Article 15 of the minutes of meeting 849-2010 dated April 30, 2010. Effective as of publication. La Gaceta

number 115, dated June 15, 2010.

Organization, governance and administration and control systems

44a) Except for branches, a copy of the deed for creating the company should be provided, which

should indicate at least the following:

i. Personal conditions required to be a member of the management body.

ii. Incompatibilities and disabilities.

iii. Reasons for leaving the position.

iv. Obligations, power and duties, inhibitions.

v. Other requirements, conditions, and procedures that are applicable to appointing, acting,

and replacing steering committee members.

b) Organizational chart identifying the different management levels, support offices for the board

of directors (e.g.: internal auditing, risk unit, compliance unit, and insurance claim handling,

and actuarial processes) and an indication of the permanent committees (e.g.: internal

auditing, information technology, and compliance).

c) Policies and procedures for at least reinsurance, investments, liquidity, money laundering,

controlling conflicts of interest, information management, and commercialization.

d) Details about the technological platform features, contingency plans, and maintenance plans.

e) Detail about the insurance commercialization model.

f) Details about the policies and procedures used to define: control of conflicts of interest,

business limits with related companies, risk subscription, retention, and transfer of risks and

reinsurance, internal control, claim processing, product distribution, investments, and

comprehensive risk management. Mixed insurance entities must provide satisfactory

information about the proposed administrative processes for separate risk management.

For the structuring of the entity's Corporate Governance System, the current principles and rules

contained in the regulations on Corporate Governance and in regulations on risk management,

insurance commercialization, legitimization of capital and financing of terrorism, consumer

protection, and information technologies must be observed.45

44 Modified by Article 15 of the minutes of meeting 849-2010 dated April 30, 2010. Effective as of publication.

La Gaceta number 115, dated June 15, 2010. 45 Paragraph added by CONASSIF through Article 12 of Meeting 1328-2017 of May 2, 2017 (Published in La

Gaceta 107 on May 19, 2017)

Activities to subcontract

A description of any outsourcing agreement that may be anticipated indicating the parties involved

and considering any data processing function that may be carried out from outside the national

territory.

D. MEMBERS OF THE BOARD OF DIRECTORS, MANAGER, ASSISTANT MANAGER, ACTUARY, INTERNAL AUDITOR AND COMPLIANCE OFFICER

1. A list with details about the full name, nationality, and an indication of the permanent domicile

of each of the members of the Board of Directors or the organization with equivalent functions,

manager, assistant managers, internal auditor, and compliance officer.

2. Certified copy from a notary public of the identification document for the person (both sides of

the ID card if the person is Costa Rican or the passport if the person is foreign).

3. Resume and police report. The signature must be authenticated by a notary public.

4. Three references about honorability and financial solvency.

5. A sworn statement in relation to the public deed, according to Appendix 11.

6. Certification of criminal background issued by the competent public organization in the

country of nationality and from the country of residence for the last five years.46

7. Written authorization for an individual empowering the responsible supervisory organization to

investigate the companies at any domestic and/or international office or organization. The

signature must be authenticated by a notary public.

8. Specifically state the names of the members of the Board of Directors that allow compliance

with at least forty percent (40%) of the members of the board of directors not being

shareholders in the entity, or related to shareholders in the company up to the third degree of

blood relationship or affinity, nor being employees of companies in the same economic or

financial group. For insurance cooperatives, an external member must be appointed.

46 Modified by Section II, paragraph 1, section d) of the minutes of meeting number 1043-2013 held on May

21, 2013. Effective as of publication. La Gaceta number 115, dated June 17, 2013.

E. ACTIVITY START-UP PLAN

1. The primary activities to undertake to start up the entity.

2. Plan for investments in property, buildings, equipment and information system applications.

3. A vote by the shareholders’ meeting empowering the Superintendency to have full unrestricted

access to any information it may require that is in the records, database, and other information

storage mechanisms by third parties who provide outsourcing services.

4. Plan for registering policies and intermediaries.

5. Plan for agent training and skills building.

6. Plan to assign premiums and disperse risks, pro formas for reinsurance or retrocession

contracts, as the case may be.

III. REQUIREMENTS FOR VERIFYING COMPLIANCE WITH THE PRE-REQUISITES

A. GENERAL INFORMATION

1. A letter applying for verification of the physical safety conditions and about information

technology, signed by the entity's legal representative.

2. A copy of the publication of the edict, certified by a notary public.

3. Indicate where the office, central office and branches are physically located. The main office

and other offices that may possibly be occupied to commercialize the services may be shared

with other individuals or companies so long as the space used by authorized entities is

absolutely separate and that they are to be used for outside activities.

B. REPORT ON PHYSICAL SECURITY AND INFORMATION TECHNOLOGY

Report on physical security and information technology. The report must refer to complying with

the following security conditions, at a minimum:

Physical security

a) Measures to regulate access by employees and the general public at the facilities.

b) Security system that is properly documented that handles the risks that the entity will be

exposed to in conformity with its functions, skill sets, business project, projected functional

structure, physical space characteristics, and other issues that are relevant for the company.47

c) System with video cameras located in strategic places such as the reception area, vault access,

and the computer center.

d) The electronic surveillance system must keep a backup of what has been filmed for at least the

last 30 days.

Technological security

a) The policies and procedures enable authenticating and authorizing access to information

systems, operating systems, and databases and to monitor transactions carried out by the

information systems, databases, and operating systems.

b) The security systems cover the public data network access points and make it possible to

restrict traffic into and out of the institutional network (firewall).

c) The computer centers have environmental and communication conditions that provide a

physical setting appropriate for functioning and protecting the material resources and staff

against natural dangers and human error.

d) The contingency plan ensures recovery of relevant information and continuous service

provision.

C. REGISTRATION WITH THE SUPERINTENDENCY

1. Entity legal capacity certification and corporate identification number.

2. Copy of the company regulations approved by the shareholders’ meeting.

3. A certified copy of the deed registered with the Public Registry.

47 Modified by Section II, paragraph 1, section e) of the minutes of meeting number 1043-2013 held on May

21, 2013. Effective as of publication. La Gaceta number 115, dated June 17, 2013.

4. A copy of the deposit vouchers in the Central Bank of Costa Rica with the minimum capital.

For already existing companies that have the capital base, the deposit in the Central Bank of

Costa Rica is the amount needed to reach the minimum capital.

5. Details with the name and ID number of the people in the related group based on the

regulations on the groups linked to the entity.

6. Certification by either a notary or public accountant that the legal and accounting books were

obtained.

2.

APPENDIX 3

AUTHORIZATION FOR INSURANCE BROKERAGE COMPANIES

Documentation required for authorization for creating and starting up intermediation activities for brokerage

companies created in Costa Rica.

I. LEGAL BASIS

A. THE CODE OF COMMERCE OF COSTA RICA

For construction and organization: Chapters 3 and 7 of Title I, Book I.

B. INSURANCE BROKER COMPANIES THE INSURANCE MARKET REGULATORY LAW, LAW 8653).

1. For creation: Articles 22, II.

2. For name: Articles 29, b).

3. For regulations: Article 29, section b).

4. For guarantees: Article 26, n).

II. DOCUMENTATION TO BE ATTACHED TO THE APPLICATION FOR CREATING A NEW ENTITY

A. GENERAL INFORMATION:

1. A letter requesting authorization to create a new entity signed by the applicant or the

applicant’s legal representative. The signature must be authenticated by a notary public. The

letter must indicate the proposed name of the entity and an address and fax number for service

of notifications.

When the applicant is acting in the name of an individual or company, as well

as providing the legal entity certification that states the power to act for the applicant’s legal

representative, it must be issued by the Public Registry, by a notary public, or by the

competent authority. If the party filing the application does so based on a proxy issued by the applicant, it must have been issued in the presence of a notary public and must come with a

certified copy. No document may be more than three months old.

3. A copy of the deed to create the company.

B. INFORMATION ABOUT OWNERSHIP STRUCTURE

Individual shareholders

1. A detailed list with the full name, nationality and permanent residence of the individual

shareholders.

2. Certified copy from a notary public of the identification document for the person (both sides of

the ID card if the person is Costa Rican or the passport if the person is foreign).

3. Resume and police report. The signature must be authenticated by a notary public.

4. Three references about honorability and financial solvency.

5. A sworn statement in relation to the public deed, according to Appendix 12.

6. Certification of criminal background issued by the competent public organization in the

country of nationality and from the country of residence for the last five years.48

7. Written authorization for an individual empowering the responsible supervisory organization to

investigate the companies at any domestic or international office or organization. The signature

must be authenticated by a notary public.

8. Written authorization for the legal representative of each of the companies in which the

individual owns 50% or more of the capital stock, empowering the responsible supervisory

organization to investigate the companies at any domestic or international office or

organization. The legal representative’s signature must be authenticated by a notary public.

9. An asset statement for the individual, including an itemization of the assets and liabilities

issued within six months prior to the filing date

48 Modified by Section II, paragraph 1, section d) of the minutes of meeting number 1043-2013 held on May

21, 2013. Effective as of publication. La Gaceta number 115, dated June 17, 2013.

for the application. The statement must be signed by the stakeholder and certified by a certified

public accountant or the equivalent professional in the country where it was issued.

10. A sworn statement entered into a notary's protocol book about the source of the funds that

specifies if financing is involved, in which case it should indicate the name of the lender, the

amount and the financing conditions.

Corporate shareholders

1. Detailed list with the full name, corporate identification number and legal domicile of the

company shareholders.

2. List with the full name, nationality and identification of the permanent domicile of each of the

shareholders in that company.

3. Certification issued by a notary public or that contains the number of the shareholders up to

the level of the individual, ID card number (or passport), description and share in the capital

stock.

4. List with the full name, nationality, and an indication of the permanent domicile of each of the

members of the Board of Directors, the Administrative Council or the organization with

equivalent functions for the legal entity.

5. Certification of legal entity status issued by the Public Registry or its peer abroad.

6. Certification issued by a certified public accountant about the amount of the capital stock that

is subscribed to and paid for and the number of shares in the company issued within six

months prior to the date that the application was filed and a certified copy of the articles of

incorporation.

7. Written authorization for the legal representative of each of the companies in which the party

owns 50% or more of the capital stock, empowering the responsible supervisory organization to

investigate the companies at any domestic and/or international office or organization. The legal

representative’s signature must be authenticated by a notary public.

8. Written authorization for each of the members of the Board of Directors, Steering Committee,

or the organization with equivalent functions, for the corporation, empowering the

Superintendency to investigate the company (ies) at any domestic and/or international office or

organization. The signature must be authenticated by a notary public.

9. Complete audited financial statements for the corporation, prepared based on the International

Accounting Standards or US GAAP for the

period ending immediately prior to the date the application was filed. The financial statements

must be audited by an authorized public accountant or the equivalent professional in the

country where they are issued.

C. THE BUSINESS PROJECT

The business project report should contain at least the following information:

Business Proposal

a) The project’s background and the reason for carrying out the insurance intermediation in

Costa Rican territory.

b) A description of the products and services that the entity projects brokering. Specify the

insurance branches for which authorization is being requested as described in Appendix 1.

c) A description of the project’s critical success factors.

d) A description of the sources of financing.

e) Features of the target market.

f) An analysis of the strengths, opportunities, weaknesses, and threats.

g) An indication of the estimated premiums products for at least three years for the main

products that the entities means to broker.

Accounting and information systems

a) A description of the information systems for identifying, managing and tracking business risk.

b) Strengths and weaknesses as they relate to the internal control and management information

systems.

Financial information

a) Pro forma financial statements including the trial balance and the profit and loss statement for

the first two years of operation. The main assumptions and the asset categories used must be

identified and justified.

b) Audited consolidated financial statements for the last fiscal period for the international

conglomerate to which the company belongs.

c) Annual financial projections for the first two years of operation, an estimate of the time period

to reach the break-even point, and an indication of the sources of financing.

d) Projection of organizational expense and installation amortization.

e) Calculation and analysis of the guarantees required for the first 12 months.

Organization, governance and administration and control systems

a) Copy of the statute project that indicates at least:

i. Personal conditions required to be a member of the management body.

ii. Incompatibilities and disabilities.

iii. Reasons for leaving the position.

iv. Obligations, power and duties, inhibitions.

v. Other requirements, conditions, and procedures that are applicable to appointing, acting,

and replacing steering committee members.

b) Organizational chart identifying the different management levels, support offices for the board

of directors (e.g.: internal auditing, compliance unit, and insurance claim handling) and an

indication of the permanent committees (e.g.: internal auditing, information technology, and

compliance).

c) Policies and procedures for at least money laundering, controlling conflicts of interest,

information management, and commercialization.

d) Details about the technological platform features, contingency plans, and maintenance plans.

e) Detail about the insurance commercialization model.

Activities to subcontract

Description of any material agreement for outsourcing that may be anticipated with an indication of

the parties involved and considering any

____________________

46 Modified by Section II, paragraph 1, section d) of the minutes of meeting number 1043-2013 held on

May 21, 2013. Effective as of publication. La Gaceta number 115, dated June 17, 2013.

function in data processing that may be conducted from outside the national territory.

D. MEMBERS OF THE BOARD OF DIRECTORS, KEY STAFF MEMBERS, AND COMPLIANCE OFFICER

1. A list with details about the full name, nationality, and an indication of the permanent domicile

of each of the members of the Board of Directors or the organization with equivalent functions,

manager, assistant managers, internal auditor, and compliance officer.

2. Certified copy from a notary public of the identification document for the person (both sides of

the ID card if the person is Costa Rican or the passport if the person is foreign).

3. Resume and police report. The signature must be authenticated by a notary public.

4. Three references about honorability and financial solvency.

5. A sworn statement in relation to the public deed, according to Appendix 11.

6. Certification of criminal background issued by the competent public organization in the

country of nationality and from the country of residence for the last five years.46

7. Written authorization for an individual empowering the responsible supervisory organization to

investigate the companies at any domestic and/or international office or organization. The

signature must be authenticated by a notary public.

E. PLAN TO START UP ACTIVITIES

1. An indication of the primary activities to undertake to start up the company.

2. Plan for investments in property, buildings, equipment and information system applications.

3. A vote by the shareholders’ meeting empowering the Superintendency to have full unrestricted

access to any information it may require that is in the records, database, and other information

storage mechanisms

____________________

47Modified by Section II, paragraph 1, section f) of the minutes of meeting number 1043-2013 held on May 21, 2013. Effective as of publication. La Gaceta number 115, dated June 17, 2013.

by third parties who provide outsourcing services.

III. DOCUMENTATION FOR VERIFYING REQUIREMENT COMPLIANCE

A. GENERAL INFORMATION

1. A letter applying for verification of the physical safety conditions and about information

technology, signed by the entity's legal representative.

2. A copy of the publication of the edict, certified by a notary public.

B. REPORT ON PHYSICAL SECURITY AND INFORMATION TECHNOLOGY

Report on physical security and information technology. The report must refer to complying with

the following security conditions, at a minimum:

Physical security

a) Measures to regulate access by employees and the general public at the facilities.

b) Security system that is properly documented that handles the risks that the entity will be

exposed to in conformity with its functions, skill sets, business project, projected functional

structure, physical space characteristics and other issues that are relevant for the company.47

Technological security

a) The policies and procedures enable authenticating and authorizing access to information

systems, operating systems, and databases and to monitor transactions carried out by the

information systems, databases, and operating systems.

b) The security systems cover the public data network access points and make it possible to

restrict traffic into and out of the institutional network (firewall).

c) The computer centers have environmental and

communication conditions that provide a physical setting appropriate for functioning and

protecting the material resources and staff against natural dangers and human error.

d) The contingency plan ensures recovery of relevant information and continuous service

provision.

C. REGISTRATION WITH THE SUPERINTENDENCY

1. Entity legal capacity certification and corporate identification number.

2. Copy of the company regulations approved by the shareholders’ meeting.

3. A certified copy of the deed registered with the Public Registry.

4. A copy of the deposit slips at the Central Bank of Costa Rica, banking guarantee letter issued

by a top notch bank or an entity supervised by the SUGEF, or in the absence thereof, a liability

policy for the amount of the minimum guarantee.

5. Detail with the name and ID number of the people in the related group based on the

regulations on the groups linked to the entity.

6. Certification by either a notary or public accountant that the legal and accounting books were

obtained.

IV. MINIMUM GUARANTEE

The minimum guarantee amount will be the greater of the following items:

a) 2.5% of the total premiums sold in the last 12 months.

b) 30,000 development units.

APPENDIX 4

AUTHORIZATION AND ACCREDITATION FOR INSURANCE AGENCY COMPANIES

Documentation required to create and accredit an insurance agency company.

I. LEGAL BASIS

A. CODE OF COMMERCE

For construction and organization: Chapters 3 and 7 of Title I, Book I B. INSURANCE AGENCY COMPANIES (REGULATORY INSURANCE MARKET LAW, LAW 8653).

1. For name: Articles 29, b).

2. For agent, broker and agency company accreditation: Articles 20, 21, 22, and 23.

3. For registration: Article 29 ñ).

II. DOCUMENTATION THAT MUST ACCOMPANY THE APPLICATION

A. Provisional accreditation of agency companies:

1. Letter of application for provisional accreditation of the agency company signed by the

applicant insurance entity's legal representative. The signature must be authenticated by a

notary public.

2. Preliminary agreement of understanding to perform the insurance intermediation signed by the

insurance entity's legal representative and the person who will function as the legal

representative for the company that will be created or transformed. The signature must be

authenticated by a notary public. The agreement must contain the effective period for the

preliminary agreement and state that provisional accreditation does not authorize the

individual or company involved to perform insurance intermediation.

____________________

48Modified by Section II, paragraph 1, section d) of the minutes of meeting number 1043-2013 held on May 21, 2013. Effective as of publication. La Gaceta number 115, dated June 17, 2013.

In addition, the details about the insurance categories, branches and lines must be submitted.

B. Documentation for authorization of reserved terms

1. Letter of application for authorization to use reserved terms by creating a new agency company

signed by the applicant or the applicant's legal representative. The signature must be

authenticated by a notary public. The letter must indicate the proposed name of the entity and

an address and fax number for service of notifications.

2. When the applicant acts in the name of an individual or company, certification of the power of

attorney granted before a notary public and certification by the Registry of the legal capacity no

more than three months old, which states the applicant’s legal representative’s capacity to act.

3. A copy of the deed to create the company.

4. Provisional accreditation of an authorized insurance entity.

5. Savings and loan cooperatives must provide certification by the National Cooperative Promotion

Institute that 25% of the company's capital has been subscribed by the associates.

III. DOCUMENTATION FOR AGENCY COMPANY AUTHORIZATION

OWNERSHIP STRUCTURE

Individual shareholders

1. A detailed list with the full name, nationality and permanent residence of the individual

shareholders.

2. Certified copy from a notary public of the identification document for the person (both sides of

the ID card if the person is Costa Rican or the passport if the person is foreign).

3. Resume and police report. The signature must be authenticated by a notary public.

4. Three references about honorability and financial solvency.

5. A sworn statement in relation to the public deed, according to Appendix 12.

Certification of criminal background issued by the competent public organization in the

country of nationality and from the country of residence for the last five years.48

in the country of nationality and from the country of residence for the last five years.48

6. Written authorization for an individual empowering the responsible supervisory organization to

investigate the companies at any domestic or international office or organization. The signature

must be authenticated by a notary public.

7. Written authorization for the legal representative of each of the companies in which the

individual owns 50% or more of the capital stock, empowering the responsible supervisory

organization to investigate the companies at any domestic or international office or

organization. The legal representative’s signature must be authenticated by a notary public.

8. An equity statement for the individual, including an itemization of assets and liabilities, issued

within six months prior to the application being filed, signed by the interested party and

certified by an authorized public accountant or an equivalent professional in the country where

it is issued.

9. A sworn statement entered into a notary's protocol book about the source of the funds that

specifies whether financing is involved, in which case it should indicate the name of the lender,

the amount and the financing conditions.

Corporate shareholders

1. Detailed list with the full name, corporate identification number and legal domicile of the

company shareholders.

2. List with the full name, nationality and identification of the permanent domicile of each of the

shareholders in that company.

3. Certification issued by a notary public or that contains the number of shareholders up to the

level of the individual, ID card number (or passport), description and share in the capital stock.

4. List with the full name, nationality, and an indication of the permanent domicile of each of the

members of the Board of Directors, the Administrative Council or the organization with

equivalent functions for the legal entity.

5. Certification of legal entity status issued by the Public Registry or its peer abroad.

6. Certification issued by a certified public accountant about the amount of the capital stock that

is subscribed to and paid for and the number of shares in the company issued within six

months prior to the date that the application was filed and a certified copy of the articles of

incorporation.

7. Written authorization for the legal representative of each of the companies in which the party

owns 50% or more of the capital stock, empowering the responsible supervisory organization to

investigate the companies at any domestic and/or international office or organization. The legal

representative’s signature must be authenticated by a notary public.

8. Written authorization for each of the members of the Board of Directors, Steering Committee,

or the organization with equivalent functions, for the corporation, empowering the

Superintendency to investigate the company (ies) at any domestic and/or international office or

organization. The signature must be authenticated by a notary public.

9. Complete audited financial statements for the corporation, prepared based on the International

Accounting Standards or US GAAP for the period ending immediately prior to the date the

application was filed. The financial statements must be audited by an authorized public

accountant or the equivalent professional in the country where they are issued.

B. SUITABILITY OF BOARD OF DIRECTORS' MEMBERS

1. A list with details about the full name, nationality, and an indication of the permanent domicile

of each of the members of the Board of Directors or the organization with equivalent functions,

manager, assistant managers, internal auditor, and compliance officer.

2. Certified copy from a notary public of the identification document for the person (both sides of

the ID card if the person is Costa Rican or the passport if the person is foreign).

3. Resume and police report. The signature must be authenticated by a notary public.

4. Three references about honorability and financial solvency.

5. A sworn statement in relation to the public deed, according to Appendix 11.

6. Certification of criminal background issued by the competent public organization in the

country of nationality and from the country of residence for

____________________

49Modified by Section II, paragraph 1, section d) of the minutes of meeting number 1043-2013 held on May 21, 2013. Effective as of publication. La Gaceta number 115, dated June 17, 2013.

last five years.49

7. Written authorization for an individual empowering the responsible supervisory organization to

investigate the companies at any domestic and/or international office or organization. The

signature must be authenticated by a notary public.

IV. ACCREDITATION BY THE SUPERINTENDENCY

1. Letter of application for accreditation of the agency company signed by the applicant insurance

entity's legal representative. The signature must be authenticated by a notary public.

2. Entity legal capacity certification and corporate identification number.

3. Copy of the company regulations approved by the shareholders’ meeting.

4. A certified copy of the deed registered with the Public Registry.

5. Details about the name and identification number of the legal representative and the agency

company's directors.

6. Certification by either a notary or public accountant that the legal and accounting books were

obtained.

APPENDIX 5

50ACCREDITATION FOR INSURANCE AGENTS AND BROKERS

Information required for accreditation for insurance agents and brokers.

I. LEGAL BASIS

A. THE INSURANCE MARKET REGULATORY LAW, LAW 8653.

1. For agent, broker and agency company accreditation: Articles 19, 20, 21, 22, and 23.

2. For the use of reserved terms: Article 29 b.

II. LICENSING AND ACCREDITATION INFORMATION FOR INSURANCE AGENTS AND BROKERS

1. Information about the person on the application for licensing or accreditation (identification type,

residency card type, identification number, name, surnames, nationality, contact telephone, home

telephone, office telephone, gender, date of birth, province, canton, and district of the permanent

residence, address, permanent residence, office address, address for acceptance of service of

notifications, email for notifications).

2. Details about the candidate's relationship with the insurance entity (for insurance agents) and the

insurance branches for which accreditation is being applied (association relationship, exclusivity and

the way the work is done, branches to accredit).

3. Sworn statement from the candidate to the agent or broker according to Appendix 13.

4. Certification of the candidate's criminal background.

5. The accreditation entity's legal representative must sign the following sworn statement:

____________________

50Reformed by Article 5 of the minutes of meeting 1221-2015 dated December 21, 2015. Published in La Gaceta number 13 dated

January 20, 2016.

a. Declaration for insurance agent applications:

"I (representative name), in my capacity as the legal representative for (insurance company name), hereby

request (licensing / accreditation) as an insurance agent for my client registered under (insurance company

identification code) for Mr. (candidate for agent's name), the bearer of identification number (candidate for

agent's ID), telephone number (candidate for agent's telephone number), and residing at address

(candidate for agent's address); under the following conditions: Agent (exclusivity) and (relationships)

[(Agency Company)] and it will be displayed at the office located at (candidate for agent's office address).

This application for accreditation is for the following insurance branches:

Branches for which the agent would like accreditation.

In addition, the power of attorney that I have been issued certifies that (entity name) has evaluated the

candidate's technical knowledge for performing as an agent in the branches in the application. The candidate

has had the following training:

In conformity with the foregoing, I certify that my client pledges to be involved in an ongoing training and update

process in the branches in the application for accreditation and in compliance with the Regulations on Insurance

Commercialization.

To finish, I bear witness to the fact that my client has considered and assessed the candidate's character in

conformity with the requirements established in the Insurance Market Regulatory Law, and the Regulations on

Authorization, Registration, and Operating Requirements for Entities Supervised by the General Insurance

Superintendency. Therefore, I am attaching the pertinent criminal background.

In addition, the candidate is authorized to work in the country if the candidate is a foreigner."

Training Type Institution Hours

Type of training received Institution where the training was

received

Number of hours of training

received

b. Declaration for insurance broker applications:

"I (representative name), in my capacity as the legal representative for (broker company name), hereby

request (licensing / accreditation) as an insurance broker for my client registered as (broker identification

code) for Mr. (broker candidate name), the bearer of identification number (broker candidate ID), telephone

number (broker candidate telephone number), and residing at (broker candidate address). It will be displayed

at (broker candidate office address). This application for accreditation is for the following insurance

branches:

Branches for which the broker would like accreditation.

In addition, the power of attorney that I have been issued certifies that (entity name) has evaluated the

candidate's technical knowledge for performing as a broker in the branches in the application. The candidate

has had the following training:

In conformity with the foregoing, I certify that my client pledges to be involved in an ongoing training and update

process in the branches in the application for accreditation and in compliance with the Regulations on Insurance

Commercialization.

To finish, I bear witness to the fact that my client has considered and assessed the candidate's character in

conformity with the requirements established in the Insurance Market Regulatory Law, and the Regulations on

Authorization, Registration, and Operating Requirements for Entities Supervised by the General Insurance

Superintendency. Therefore, I am attaching the pertinent criminal background.

In addition, the candidate is authorized to work in the country if the candidate is a foreigner."

Training Type Institution Hours

Type of training received Institution where the training

was received

Number of hours of training

received

APPENDIX 6

AUTHORIZATION FOR MERGING SUPERVISED ENTITIES

Documentation required for authorization for merging supervised entities.

I. LEGAL BASIS

A. CODE OF COMMERCE

Chapter 10 – mergers and transformation – from Title I, Book I.

B. THE INSURANCE MARKET REGULATORY LAW, LAW 8653.

1. For authorization: Article 29 c).

C. THE LAW ON PROMOTING COMPETITION AND EFFECTIVE CONSUMER DEFENSE (LAW 7472)

1. For merger processes: Article 27 bis:

II. DOCUMENTATION TO BE ATTACHED TO THE APPLICATION FOR MERGING AN ENTITY

A. GENERAL INFORMATION:

1. An application letter requesting authorization to merge one or more entities with other

companies, signed by the legal representatives of the companies involved. The letter must

indicate the proposed name of the resulting entity, the type of merger, the prevailing entity in

the merger process, and an address and fax number for service of notifications.

2. Certification of the power of attorney witnessed by a notary public, competent authority, or

registry certification of legal capacity not more than three months old, stating the applicants’

legal representative’s capacity to act.

3. Copy of the letter of intent for the merger process, which must be duly approved

by the shareholders' or associates' meeting or the body with equivalent functions as the entities

involved in the process.

4. A certification issued by a notary public for the vote by the shareholders’ or associates’ meeting

or by the body with the equivalent functions stating that approval was given for the letter of

intent for the merger by each of the companies involved.

5. A copy of the merger deed, an extract of which must be published one time in the daily journal

afterward.

B. THE BUSINESS PROJECT

The business project report should contain at least the following information:

Business proposal

a) Project background and reason for carrying out the merger.

b) An executive summary of the due diligence studies done for the merger.

c) A description of the products and services that the entity projects offering.

d) A description of the project’s critical success factors.

e) A description of the sources of financing.

f) Features of the target market.

g) An analysis of the strengths, opportunities, weaknesses, and threats.

h) An indication of the current and estimated market shares for at least three years for the main

financial products and services that the entity offers or intends to offer.

Accounting and information systems

a) A description of the information systems for managing and tracking business risk with

emphasis on incompatibilities.

b) Strengths and weaknesses as they relate to the internal control and management information

for the companies participating in the merger process.

Financial information

a) Pro forma financial statements including the trial balance and the profit and loss statement for

the first three years of operation for the resulting or prevailing entity. The main assumptions

and the asset categories used must be identified and justified.

b) Audited consolidated financial statements for the last fiscal period for the international

conglomerate to which the resulting or prevailing company will belong.

c) Annual financial projections for the first three years of operation for the resulting or prevailing

entity, with a projected indicator calculation and analysis for requirement adequacy, projected

risk and equity adequacy rating for the first 12 months for the resulting or prevailing entity.

Financial projections detailed by month for the first 12 months of operation for the resulting or

prevailing entity.

d) Main risk identification and analysis (market, credit, interest rate, exchange rate, image,

liquidity, technique), applying sensitization scenarios to the financial projections.

Organization, governance and administration and control systems

a) Copy of the statute project that indicates at least:

i. Personal conditions required to be a member of the management body.

ii. Incompatibilities and disabilities.

iii. Reasons for leaving the position.

iv. Obligations, power and duties, inhibitions.

v. Other requirements, conditions, and procedures that are applicable to appointing, acting

as, and replacing steering committee members.

b) Organizational chart identifying the different management levels, support offices for the board

of directors (e.g.: internal auditing, risk unit, compliance unit, insurance claim handling, and

actuarial processes) and an indication of the permanent committees (e.g.: internal auditing,

information technology, and compliance).

c) Policies and procedures for investments, liquidity, money laundering, controlling conflicts of

interest, information management and commercialization.

d) Details about the technological platform features, contingency plans, and maintenance plans.

e) Details about the insurance commercialization model.

Activities to subcontract

A description of any outsourcing agreement that may be anticipated indicating the parties involved

and considering any data processing function that may be carried out from outside the national

territory.

III. REGISTRATION WITH THE SUPERINTENDENCY

1. Legal capacity certification.

2. Copy of the company regulations approved by the shareholders’ or associates’ meeting or by a body

with equivalent functions.

3. A certified copy of the deed registered with the pertinent Registry.

4. A list with details about the name and ID number of the people in the related group based on the

regulations on the groups linked to the entity.

5. A copy of the publication of the extract of the merger document in the La Gaceta official journal.

IV. INTEGRATION OPERATING PLAN

A merger plan approved by the Boards of Directors or Steering Committees. This plan must detail the

actions that will be taken to achieve full integration of the participants with an indication of the

estimated execution dates. It must include at least the following actions as applicable to the nature of

the resulting or prevailing entity’s activities:

a) Release of information to the participants’ creditors and debtors.

b) Any advertising should refer to the use of business names and brands belonging to the participant

companies.

c) Designation of the key executive staff in the resulting or prevailing entity.

d) Information migration from the automated systems’ databases.

e) Integration of the accounting, information technology, and management information systems to

ensure timely transmittal of the information required by the Superintendency including a

contingency plan for business continuity.

f) Policy and intermediary registration.

g) Acquisition and elimination of assets (buildings, systems, equipment, etc.).

h) Physical movement of documents.

i) Office openings and closures.

j) Preparation of accounting entries to close the participants’ balances, as pertinent, as of the merger

date.

k) Replacement or revocation of powers of attorney.

l) Dissolution of the participants as pertinent.

m) A business stoppage plan for one participant, as pertinent.

n) Plan for name change, when appropriate.

o) Notification to the Costa Rican Social Security Institute about the change in employer for the

participants’ employees.

p) A draft of the communication to the insureds to be sent by the insurance company that prevails or

the acquiring company about the change in control or the merger and of the insureds' right to have

the stipulated contractual conditions respected, unless they expressly accept the modification. The

communication must take place within a maximum period of ten business days after the

communication of the Superintendency's authorization. It must also be published, as a minimum,

in a newspaper with national circulation on at least two different dates.

APPENDIX 7

AUTHORIZATION FOR FULL OR PARTIAL PORTFOLIO TRANSFER

Documentation required for the full or partial transfer of the portfolio between insurance entities.

I. LEGAL BASIS

A. THE INSURANCE MARKET REGULATORY LAW, LAW 8653.

1. For authorization: Article 29 c).

B. THE LAW ON PROMOTING COMPETITION AND EFFECTIVE CONSUMER DEFENSE (LAW 7472)

1. For merger processes: Article 27 bis:

II. DOCUMENTATION TO BE ATTACHED TO THE APPLICATION FOR FULL OR PARTIAL PORTFOLIO

TRANSFER

A. GENERAL INFORMATION:

1. Letter requesting authorization to fully or partially transfer the portfolio and signed by the

legal representatives of the companies involved. The letter should indicate which insurance

lines and branches are involved in detail.

2. Certification of the power of attorney witnessed by a notary public, competent authority, or

registry certification of legal capacity not more than three months old, stating the applicants’

legal representative’s capacity to act.

3. A copy of the transfer process letter of intent duly approved by the shareholders’ or associates’

meeting or by the body with the equivalent functions at the entities involved in the process.

4. A certification issued by a notary public of the vote by the shareholders’ or associates’ meeting

or by the body with the equivalent functions stating the approval for the letter of intent for the

transfer process on the part of

each of the companies involved

B. THE BUSINESS PROJECT

The business project report should contain at least the following information:

Business proposal

a) Project background and reason for carrying out the transfer.

b) An executive summary of the due diligence studies done for the transfer.

c) An indication of the current and estimated market shares for at least three years for the

insurance lines involved in the transfer.

Financial information

a) Financial projections for the first three years with a calculation and analysis of the projected

adequacy indicators for the projected asset requirements for the entity making the transfer and

the entity receiving the transfer. Detailed financial projections by month for the first 12 months

of the transfer.

III. TRANSFER OPERATING PLAN

A transfer plan approved by the Boards of Directors or Steering Committees. This plan must detail the

actions that will be taken to achieve transfer of the negotiated portfolio with an indication of the

estimated execution dates. It should include at least the following actions:

a) A draft of the communication to the insureds to be sent by the insurance company that prevails or

the acquiring company about the change in control or the merger and of the insureds' right to have

the stipulated contractual conditions respected, unless they expressly accept the modification. The

communication must take place within a maximum period of ten business days after the

communication of the Superintendency's authorization. It must also be published, as a minimum,

in a newspaper with national circulation on at least two different dates.

b) Subscription to the contract addendum that replaced the insurance company.

c) Physical movement of documents.

d) Preparation of accounting entries.

APPENDIX 8

AUTHORIZATION FOR THE SUPERVISED ENTITY TO CHANGE ITS NAME

Documentation required for authorization for a change in name.

I. LEGAL BASIS

A. THE CODE OF COMMERCE OF COSTA RICA

1. For creation of companies: Articles 18 and 19.

2. For business names: Book I, Title II, Chapter 4 – Business Names.

B. THE INSURANCE MARKET REGULATORY LAW, LAW 8653.

1. For name: Article 29 b.

II. DOCUMENTATION TO BE ATTACHED TO THE APPLICATION FOR AUTHORIZATION FOR A NAME

CHANGE

A. GENERAL INFORMATION:

1. A letter applying for authorization to change the name, signed by the entity’s legal

representative. The signature must be authenticated by a notary public. The letter must specify

the reasons behind the application and the proposed entity name.

2. A copy of the document to submit to change the name.

3. Notary certification based on the vote by the shareholders’ meeting or by the body with

equivalent functions, stating final approval.

4. Name change plan. The name change plan must detail

the actions for managing information for clients, creditors, or investors and the successive

commitments related to using letterhead and advertising, etc., and must include at least the

following actions:

a) How the information for clients and the general public will be managed.

b) Notification of the change in name by means of a one-time publication in the La Gaceta

official journal and in a newspaper with national circulation.

c) Actions in relation to using terms reserved by law. This should include actions related to

any advertising in place, Internet sites, and other business descriptions.

d) This should include letterhead, advertising and other forms of communication of the

phrase “Previously (previous name of the entity).” The period during which this phrase

must be included will be defined by the ruling body in its communication about the

authorization.

e) Changes in the outdoor signs at the entity’s establishments.

III. REGISTRATION WITH THE SUPERINTENDENCY

1. An agreement by the ruling body about authorization to change the name.

2. A copy of the publication of the edict in the La Gaceta official journal and in a newspaper with

national circulation where the change in name is announced.

3. A notary certified copy of the deed registered with the pertinent Registry.

APPENDIX 9

AUTHORIZATION FOR A SUPERVISED ENTITY TO VOLUNTARILY CEASE OPERATIONS

Documentation required to authorize a supervised entity to cease operations.

I. LEGAL BASIS

A. THE INSURANCE MARKET REGULATORY LAW, LAW 8653.

1. For voluntary cessation of activities: Article 32.

II. DOCUMENTATION THAT MUST ACCOMPANY THE APPLICATION TO CEASE ACTIVITIES

A. DOCUMENTATION REQUIRED FOR AUTHORIZATION TO CEASE ACTIVITIES

1. An application letter signed by the legal representative, applying for permission to cease

activities. The letter must specify the reasons behind the application for authorization.

2. Certification issued by a notary public or the competent authority for the minutes of the

shareholders’ or associates' meeting, or by the body with equivalent functions, stating final

approval of the action subject to authorization.

3. A copy of the deed related to the application.

4. A ruling or a similar communication issued by the supervisory body for the parent company

abroad that indicates whether any objection to the applications exists (if so, the reasons that

justify the objection must be listed).

B. OPERATING PLAN FOR PORTFOLIO TRANSFER

A transfer plan approved by the Boards of Directors or Steering Committee. This plan must detail

the actions that will be taken to achieve transfer of the negotiated portfolio with an indication of the

estimated execution dates. It should include at least the following actions:

a) A draft of the communication to the insureds to be sent by the insurance company that

prevails or the acquiring company about the change in control or the merger and of the

insureds' right to have the stipulated contractual conditions respected, unless they expressly

accept the modification. The communication must take place within a maximum period of ten

business days after the communication of the Superintendency's authorization.

b) Subscription to the contract addendum that replaced the insurance company.

c) Physical movement of documents.

d) Preparation of accounting entries.

C. OPERATION CESSATION PLAN

Plan detailing the actions to be carried out with an estimated date of execution. It must include at

least the following actions as applicable to the nature of the entity’s activities:

a) Actions in relation to using terms reserved by law. It should include actions related to any

advertising in place, Internet sites, and other business descriptions.

b) Indication of the mechanisms to ensure compliance with the entity’s obligations.

c) Office closures.

d) Revocation of powers of attorney.

e) Closing accounting entries, as applicable.

f) Closing legal book, as applicable.

g) The dissolution process, as applicable.

III. CANCELLATION OF REGISTRATION WITH THE SUPERINTENDENCY

1. A copy certified by a notary public or the competent authority for the deed that was registered, stating that the company has been dissolved.

APPENDIX 10

AUTHORIZATION FOR CHANGES IN AN INSURANCE ENTITY ARTICLES OF INCORPORATION

Documentation required for authorization for a change in articles of incorporation.

I. LEGAL BASIS

A. THE INSURANCE MARKET REGULATORY LAW, LAW 8653.

1. For authorization for changes to the articles of incorporation: Article 29 b.

II. DOCUMENTATION THAT MUST ACCOMPANY THE APPLICATION

1. An authorization application letter signed by the entity’s legal representative. The signature must

be authenticated by a notary public.

2. A copy of the minutes of the meeting where the modifications to the articles of incorporation were

agreed upon that are being submitted for approval.

3. A comparative matrix showing the current text and the proposed text for each article to be

modified.

4. A transcription of the current articles in the regulations detailing the requirements to be fulfilled to

agree to modifying them, including the number of associates that must be present at the associates’

meeting, and the number of votes needed to approve changing the regulations.

5. When dealing with a comprehensive change to the regulations, a copy of the minutes of the meeting

where the modifications were approved and a copy of the previous regulations must be provided.

6. A document explaining the reason for the changes.

APPENDIX 11

SWORN STATEMENT

DIRECTORS, GENERAL MANAGER, ASSISTANT MANAGERS, INTERNAL AUDITOR, AND COMPLIANCE OFFICER.

I. GENERAL INFORMATION

Full name.

Identification number

Date of birth Nationality

Permanent domicile

Position to be occupied

II. RELEVANT ACADEMIC BACKGROUND

1. General manager, assistant general managers, internal auditor, and compliance officer. Relevant

academic background with an indication of the year it was obtained and the name of the

educational institution. Specialized training relevant to insurance, banking, brokerage, or financial

issues with an indication of the year it was obtained and the name of the educational institution.

2. Directors: Academic training with an indication of the year it was obtained and the name of the

educational institution. For Directors, the specialized academic training on subjects related to

insurance, banking, stocks and bonds, or finances is not essential for suitability.

III. RELEVANT WORK EXPERIENCE AND HISTORY

Positions held, with an indication of the position held, the name of the employer in each case, the

employer's business and the dates the position was held. For Directors, the work experience or history

relative to subjects related to insurance, banking, stocks and bonds, or finances is not essential for

suitability.

IV. DISCIPLINARY AND LEGAL BACKGROUND

1. During the last 4 years, has any company where you have been or were related to as the general

manager, assistant general manager, member of the Board of Directors, or an internal auditor been

sanctioned by any banking, brokerage, or financial supervisory authority due to any decisions

made while exercising your position? If so, include the details.

2. During the last 4 years, has any company where you have been or were related to as manager or

director, been sanctioned by any legal authority due to any decisions made while exercising your

position

3. During the last 4 years, have you been sanctioned by any legal authority due to any decisions made

while exercising your position?

4. During the last 4 years, have you been required to pay any sort of liability levied by any domestic or

foreign legal authority?

5. During the last 4 years, have you been discharged, in any country, from any position or job as a

consequence of a disciplinary proceeding against you by your ex-employer or at the

recommendation of any banking, brokerage, or financial supervisory authority? If so, include the

details.

6. During the last 4 years while you were related to a company in any country as a member of the

Board of Directors or Steering Committee, general manager, or assistant general manager, was the

company declared to be culpably or fraudulently bankrupt by any court system in any country?

7. During the last 5 years, have you been sentenced for wrongful crimes against property, crimes

against good faith in business or money laundering in any court system in any country or are you

serving a sentence? If so, provide the details.

8. During the last 4 years, have you been declared bankrupt or in receivership intervention by any

court or administrative authority in any country? If so, provide the details.

9. During the period in which you were related to a company in any country as a member of the Board

of Directors or Steering Committee, general manager, or assistant general manager, was the

company declared to be in legal or administrative receivership intervention by any banking,

brokerage, or financial supervisory authority due to decisions made while exercising your position?

If so, provide the details.

10. The information provided in this Appendix must be accompanied by the following statement:

DECLARATION

I hereby declare that I am aware that providing false or erroneous information constitutes a cause

for authorization to be denied or revoked.

Likewise, I hereby declare that the information set forth in this document is complete and exact

and that I am not aware of or do not know of any other relevant facts in relation to the application

that is being processed.

I pledge to report to the Superintendency about any substantial change in relation to this

application that may arise during processing.

The Superintendency will maintain the confidentiality of the information provided as a response to

this Appendix.

APPENDIX 12

SWORN STATEMENT BY PARTNERS

I. GENERAL INFORMATION

Full name.

Identification number

Nationality

Permanent domicile

II. DISCIPLINARY AND LEGAL BACKGROUND

1. During the last 4 years, have you been required to pay any sort of liabilities levied by any domestic

or foreign legal authority?

2. During the last 4 years while you were related to a company in any country as a member of the

Board of Directors or Steering Committee, general manager, or assistant general manager, was the

company declared to be culpably or fraudulently bankrupt or in a state of administrative or legal

receivership by any court system in any country?

3. During the last 5 years, have you been sentenced for wrongful crimes against property, crimes

against good faith in business or money laundering in any court system in any country or are you

serving a sentence? If so, provide the details.

4. During the last 4 years, have you been declared bankrupt or in receivership intervention by any

court or administrative authority in any country? If so, provide the details. If so, provide the details.

5. During the period in which you were related to a company in any country as a member of the Board

of Directors or Steering Committee, general manager, or assistant general manager, was the

company declared to be in legal or administrative receivership intervention by any banking,

brokerage, or financial supervisory authority due to decisions made while exercising your position?

If so, provide the details.

DECLARATION

I hereby declare that I am aware that providing false or erroneous information constitutes a cause

for the authorization to be denied or revoked.

Likewise, I hereby declare that the information I have provided in this document is complete and

accurate.

I pledge to report to the responsible supervisor about any substantial change in relation to this

application that may arise during processing.

The Superintendency will maintain the confidentiality of the information provided as a response to

this Appendix.

____________________

51 Reformed by Article 5 of the minutes of meeting 1221-2015 dated December 21, 2015. Published in La Gaceta issue 13 dated January 20, 2016.

51APPENDIX 13

SWORN STATEMENT INSURANCE AGENTS AND BROKERS.

I. GENERAL INTERMEDIARY INFORMATION

II. RELEVANT ACADEMIC BACKGROUND

1. Relevant academic background with an indication of the year it was obtained and the name of the

educational institution.

2. Specialized relevant training for performing as an insurance agent or broker with an indication of the year

when it was received and the name of the institution.

a. Full name:

b. Identification number:

c. Date of birth:

d. Nationality:

e. Permanent domicile:

f. Accrediting entity:

g. Address for Service of Notifications:

h. Email for notifications:

Type Year Institution

III. RELEVANT WORK EXPERIENCE AND HISTORY

Positions held, with an indication of the position held, the name of the employer in each case, the employer's

business and the dates the position was held.

IV. SPECIFIC INTERMEDIARY INFORMATION52

Related (Yes/No)

Name of the agency company if related

The intermediary is exclusive (Yes/No)

How the work is done (in the name or on account of the entity /

only on account of --[subject to entity assessment])

V. BRANCHES TO BE ACCREDITED

VI. DISCIPLINARY AND LEGAL BACKGROUND AND INCOMPATIBILITIES

____________________ 52This information is only required for insurance agents.

Type Branches Subject

Training

(Internal /

External)

Begin-

ning

Date

End-

ing

Date

Total

hours Title

Obtained Institution

Area Position Employer Activity Year

Hired

Year

Quit

Question Response

1. In the last year have you functioned as a director, manager, or

employee of insurance, re-insurance, or financial entities that are part of

the same financial group or conglomerate as the brokerage company that

is applying for accreditation?

Yes / No

2. In the last year have you performed activities, whether directly or

indirectly, that are associated with the types of insurance that may

generate conflicts of interest as described in Article 18 of the Regulations

on Insurance Commercialization?

Yes / No

3. Are you currently performing any activity, directly or indirectly, that

may be associated with the types of insurance that may generate

conflicts of interest, listed below: Yes / No

a. Do you perform activities as an insurance agent or insurance broker?

Yes / No

b. Are you a member of the governing body, a manager, administrator or

a general proxy or do you head (no matter what your title is) an

insurance intermediary company of the same or a different nature as the

company being accredited?

Yes / No

c. Are you a member of the governing body, a manager, administrator or

a general proxy or do you head (no matter what your title is) an

insurance or reinsurance entity? Yes / No

d. Are you a shareholder in, an employee of, or an external aide to

another insurance intermediary company of the same or a different

nature as the insurance or reinsurance entity? Yes / No

e. Are you a member of the governing body, a manager, administrator or

a general proxy or do you head (no matter what your title is) an

insurance intermediary company to which you are not related for an

insurance or reinsurance entity? Yes / No

The information provided in this Appendix must be accompanied by the following statement:

Declaration

I hereby declare that I am aware that providing false or erroneous information constitutes a cause for the

license to be denied or revoked.

Likewise, I hereby declare that the information set forth in this document is complete and exact and that

I am not aware of or do not know of any other relevant facts in relation to the application that is being

processed.

I pledge to report to the Superintendency about any substantial change in relation to this application that

may arise during processing or after the license is issued.

The Superintendency will maintain the confidentiality of the information provided as a response to this

Appendix, in conformity with its legal obligations.

______________________________________

NAME AND SIGNATURE

f. Are you a shareholder in, an employee of, or an external aide to an

insurance intermediary company to which you are not related for an

insurance or reinsurance entity? Yes / No

g. Are you a member of the governing body, a manager, administrator or

a general proxy or do you head (no matter what your title is) a self-issued

insurance operator or are you a shareholder in or an employee of a self-

issued insurance operator?

Yes / No

4. Have you, in the last five years, been declared to be guilty of a criminal

offense due to the commission of an intentional crime against property,

good faith in business and the public faith as defined in Titles VII, VIII,

and XVI of Book II of the Criminal Code, respectively?

Yes / No

5. Are you serving a sentence for a criminal offense due to the

commission of an intentional crime against property, good faith in

business and the public faith as defined in Titles VII, VIII, and XVI of

Book II of the Criminal Code, respectively?

Yes / No

APPENDIX 14

MINIMUM REQUIREMENTS FOR THE ENTERPRISE RISK MANAGEMENT SYSTEM

A. Policies and procedures manual

The policies and procedures manual for enterprise risk management must include, at least, the following issues:

a. Organizational structure: Detail the functional structure for performing risk management. The

structure must establish that there is independence between risk management and the other

operational control areas.

b. Risk and solvency policy: The policy clearly and must precisely identify the criteria used by the

organization to identify, evaluate, rate, and track the entity's risks as well as its solvency position.

c. Risk retention and cessation policy: The policy must define the explicit limits for retaining risk

by insurance branch and define the policies for choosing, monitoring and contracting reinsurance

companies, along with the procedures and authorization levels.

d. Investment policy: The policy must take special care in managing the assets that back up each of

the insurance branches. It must include, as a minimum, the investment objectives, authorization

for securities that might be acquired, maximum concentration criteria by security type, deadline,

currency and issuer, and securities liquidity criteria. In addition, it must define the investment

procedures and practices.

e. Conflict of interest policy: Release the fulfillment policy with the requirements in these

regulations.

f. Appointment policy: As a minimum, for key executives, committee members and the people

responsible for the actuarial function and internal control.

g. Procedures: Definition of procedures, position profile and function delimitation.

h. Communication: The method and frequency for reporting to the governing body.

i. Self-evaluation: Self-Evaluation frequency and methods.

j. Methodologies: Determination or procedure for calculating limits on taking risks.

k. Internal control: The internal control measures and the measures for correcting deviations that

are observed related to the risk exposure limits.

l. Actuarial function: Description of how the entity performs the actuarial function.

m. Approval: Process for approving proposals, strategies and initiatives for risk management and, as

the case may be, coverage types. The proposals must have a general description of any new

operations, an analysis of its implicit risks, the procedure to use to identify, measure, monitor,

track, report, and reveal such risks, as well as an opinion about the proposal's corporate viability.

n. Risk mitigation: Definition of procedures for defining action plans in case of contingencies due to

acts of God or force majeure.

The Manual must be accompanied by a technical document that contains the models and

methodologies for assessing the different types of risks, as well as the requirements for the information

processing systems and for risk analysis.

B. Metrics, monitoring, tracking and the contents of the internal reports.

To perform the measurement, monitoring, and tracking of diverse types of quantifiable risk and to

assess the positions, the entity must:

a) Have risk measurement models and systems that incorporate information that includes relevant

variables to be able to measure exposure to risk and sensitivity to diverse risk factors.

b) The information must be accurate, comprehensive and timely so any modification to the

aforementioned information must be documented and come with an explanation about its nature

and what caused it.

c) Run periodic reviews of the assumptions contained in the allowance models.

e) Periodically compare the allowances for risk exposure against the results that were actually

observed for the same measurement period and, as the case may be, modify the assumptions used

to formulate said allowances.

C. Simulating testing

Risk measurement should be complemented by running tests under extreme conditions. This testing

should make it possible to identify the risks that the entity will face under those conditions and

recognize the positions or strategies that make funds more vulnerable. Therefore, it must:

a) Estimate the risk under conditions where the fundamental assumptions and the parameters used

to measure risk are at a stalemate, including the entity's response capacity to minimize the effects

of the solvency regimen under such conditions.

b) Evaluate the design and results of testing under extreme conditions so the evaluation may be used

to establish applicable contingency plans.

c) Consider the results generated by testing under extreme conditions when reviewing policies and

limits for taking risks.

APPENDIX 15

53

REGISTERING POLICIES COMMERCIALIZED USING ADHESION CONTRACTS

AND TECHNICAL NOTES (Repealed by section 2, Article 9 of the minutes of

meeting 1131-2014, held on October 27,, 2014, published

in La Gaceta 228 dated November 26, 2014)

Documentation required for registering policies using adhesion contracts and technical notes.

I. LEGAL BASIS

A. THE INSURANCE MARKET REGULATORY LAW, LAW 8653

1. For policy registration: Articles 25 k and 29 d.

II. DOCUMENTATION THAT SHOULD ACCOMPANY THE APPLICATION FOR POLICY REGISTRATION

A. GENERAL INFORMATION

1. Letter requesting authorization to register the policy and technical note signed by the entity's legal representative or the person that

the legal representative delegates to submit it.

2. Notary certification of the minutes of the governing body that had passed a motion to authorize the product. The governing body

may expressly delegate how it is managed in the motion to define the products' characteristics. In such a case, the document must

be attached.

3. The technical note that underwrites the products being applied for registration.

4. Contractual documentation.

5. The type to use in the policies, endorsements, additional clauses and other contractual documentation that establish the exclusions

must be clear, legible, and crisp.54

6. To explain to the applicant for insurance that the simple fact that the application has been signed and delivered to the insurance

agent or the entity is not a guarantee that the latter will accept entering into a contract or the proposed terms. Unless it guarantees

accepting the application, the entities must include the following text in clear, crisp, legible type on all the insurance application

forms:

"This document is solely an insurance application; therefore, it does not represent any guarantee that it will be accepted by the

insurance company or that, if it is accepted, the acceptance will totally agree with the terms of the application. 55

7. Minimum information for registering auxiliary services according to the contents of Appendix 17. (Mandatory if the policy limits

free choice of an auxiliary service provider for reparation of damages).

8. Description of the product distribution channel.

9. For the self-issued insurance products indicated in sections 3), 4), 5), and 6), compliance with the characteristics defined in Article

24 of the Insurance Market Regulatory Law must be substantiated.

____________________ 53

Repealed by section 2, Article 9, of the minutes of meeting 1131-2014, held on October 27, 2014, published in La Gaceta number 228 dated

November 26, 2014. 54

Modified by Section II, paragraph 1, section i) of the minutes of meeting number 1043-2013 held on May 21, 2013. Effective as of publication. La

Gaceta number 115 dated June 17, 2013. 55

Modified by Section II, paragraph 1, section j) of the minutes of meeting number 1043-2013 held on May 21, 2013. Effective as of publication. La

Gaceta number 115 dated June 17, 2013.

III. FORMAL REQUIREMENTS FOR REGISTERING INSURANCE

1. The technical note that must be signed by an actuary. The cover sheet for the technical note must show the following legend:

"I, (name of professional), the bearer of identification card number _______________________ attest to the fact, as a responsible

professional, that the methodology for determining the premium, provisions and other technical elements in this technical note are in line

with the contents of the Insurance Market Regulatory Law and the current standards."

2. The contract model, which must be signed by the person responsible for preparing the legal opinion that backs it.

3. The legal opinion that certifies that the contractual documentation is in line with the contents of the Insurance Market Regulatory Law

and the current standards for insurance contracts. The document must contain the following legend:

"I, (name of professional), the bearer of national identification card ______________________ and Costa Rican Bar Association number

________________________, attest to the fact, as a responsible professional, that the contractual documentation called (product name)

is in line with the contents of the Insurance Market Regulatory Law, the standards that govern insurance contracts and other applicable.

Provisions.

4. The analysis for congruency between the technical note and the contractual documentation. This document will be signed by both the

actuary in charge of preparing the technical note and by the entity's attorney, which must include at least the following legend:

"We, the undersigned (actuary name), the bearer of identification card number __________________ and code

_____________________ and (name of the institution's attorney), the bearer of identification card number______________________

and professional code _________________, swear that we have verified that the obligations assumed in the contractual conditions for the

product called (product name) and it is faithfully backed by the actuarial methods described in the pertinent technical note."

5. The entities may request a unique registration number for the insurance products that are offered to the public as non-adhesion contracts.

In such a case, the general forms or models must be sent that are used in this type of contract and must accurately state which clauses or

concepts are subject to change during the procurement process. If, when the contract is entered into, the contractual documentation

project that was previously registered is modified, the entity must apply for replacement of the product in the registry.

IV. MINIMUM CONTENT OF THE TECHNICAL NOTE

A. PRODUCT FEATURES

a) The product's technical and contractual characteristics must be established.

b) Product name: The name that the insurance entity will use to identify the product will be indicated.

c) Product category and branch:

d) Product procurement modes: Life and accident and illness insurance policies should indicate the modes used to procure the

product. The modes will be understood to mandatorily be individual or group.

e) Special product characteristic: Since a single institution may register and operate two or more products that are equal in name and

procurement mode, it must indicate whether the product has any special characteristic that distinguishes it from any other product

with the same name and procurement mode.

f) Product seasonality: The number of years or shorter period of time that the contract will be effective must be indicated. A concrete

number of years, a range of values, or a generic description such as "advanced age," "for life," "retirement age," "multi-annual," and

other descriptions may be indicated.

g) Contract type: The fact that the technical note pertains to an adhesion contract or an adhesion contract in the model contract mode

must be indicated.

B. DESCRIPTION OF COVERAGE TYPES

The risks covered, benefits, deadlines, and other technical issues that characterize the forms of product coverage must be indicated:

a) Description of the basic coverage type: A clear description of the risk covered by the entity must be given for

the type or types of goods that are covered, the benefit, or the compensation that will be provided in case of an accident, as well as

any circumstance under which such coverage types or benefits will change or vary during the insurance effective period.

Model contracts must state whether the main coverage type may be negotiated with the policy holder. If so, the parts that may be

modified must be accurately indicated.

b) Description of additional coverage types: Each of the additional and optional coverage types that the product will include or that may

be procured by means of an express agreement must be indicated, along with the risk covered by the entity, the property being

covered, and the benefit or compensation that will be provided in case of accident in each of said coverage types.

Model contracts must state whether the additional coverage types may be negotiated with the policy holder. If so, the parts that may

be modified must be accurately indicated.

c) Description of service coverage types: The type of services that the product will include must be indicated, such as: medical, legal,

automotive, trip, home, or other types of assistance, as well as the conditions for using them.

Model contracts must state whether the service coverage types may be negotiated with the policy holder. If so, the parts that may be

modified must be accurately indicated.

C. TECHNICAL THEORIES

To calculate the risk premium and provision of risks in place:

a) Insurance in the life branch must indicate and include the demographic assumptions such as tables on mortality, morbidity,

disability, or any other assumption that will be used to calculate the risk premiums and risk provisions in place.

b) Accident and illness insurance policies must indicate and include the tables on frequency, average amounts, morbidity, accident

index, or any other pertinent fact that will be used to calculate the risk premiums. The source must also be indicated.

c) Insurance for damages must indicate the assumptions related to frequency, severity, the accident index or any other assumption that

will be applied to calculate the risk premiums.

D. STATISTICAL INFORMATION

Except for the insured mortality tables established by the National Financial System Supervisory Council, the statistical information that

will be used must be included and indicated and the data needed for identification and verification must be indicated, such as country,

author, and year:

a) As part of the technical note, the consolidated statistical information data must be included that were used to determine the values

for frequency, severity, average amounts or any other premium parameter.

b) The entity must indicate any material issue related to modifying, cleaning up and transforming the original statistical data.

c) If reinsurance company rates are adopted, the reinsurance contract that covers the risk in question and the technical note based on

these rates must be submitted.

d) When there is no information for the entity or the insurance market that is adequate and reliable in terms of the contents of the

actuarial practice standards to be able to calculate the product premium, experimental rating schemes may be proposed. In such

cases, the product technical note must indicate that it is an experimental rate and that it will be updated.

E. FINANCIAL THEORIES

To calculate the premium and provision of risks in place:

a) Technical interest rate: The technical interest rate(s) will be indicated that will be used to calculate the current premiums and

provision of risks. Likewise, the assumptions related to inflation, wage increases or any other issue to be used must be indicated.

b) Foundations: The technical interest rate amount being proposed to be used, as the case may be, for calculating the current

premiums or risk provision must be justified in conformity with the principles established for those purposes in the actuarial

practice standards and the current standards on technical provisions.

c) No technical justification will be required for the technical interest rate for calculating the premiums proposed by the regulatory

entity.

F. RISK PREMIUM PROCEDURES AND FOUNDATIONS

The procedures, formulas, and parameters used to calculate the risk premium will be indicated. A risk premium will be understood to be

the estimate for obtaining the risks needed to face any necessary outlay for paying for accidents or income stipulated contractually or the

security surcharge. The following must be provided:

a) Risk premium formulas: The formula or procedure used to calculate the risk premium must be indicated.

b) Foundations: If formulas that were specifically designed by the actuary, mathematical theorems, probability functions, credibility

theory, or stochastic processes are proposed for application, the foundations must be indicated.

c) Parameters: The parameter calculation value and form that are part of the risk premium calculation formulas or procedures must

be indicated.

d) Deductibles, co-insurance and co-pays: The calculation formulas or the deductible, co-insurance or co-pay amounts to be applied,

as the case may be, must be indicated, as well as the way the deductibles and co-insurance will be reflected in the risk premium

calculation.

e) Risk-based surcharges and discounts: Any surcharge or discount to be made as part of the risk premium must be indicated and

justified based on the increase or decrease in the expected risk value as a consequence of a determined circumstance.

f) Shares or other benefits as a function of accident behavior, the risk quality, the customer risk, the transaction amount risk, the

payment method risk etc.

The value of discounts or surcharges, shares or other benefits based on the estimate for the decrease or increase that the circumstance

produces on the expected risk cost or due to the lack of statistical information, based on the qualitative foundations that clearly explain

the influence of said circumstance on the insured risk must be justified.

G. COMMERCIAL PREMIUM OR RATE PROCEDURES

The procedures, formulas and parameters used to calculate the commercial premium or rate will be indicated. In addition to the

indications for the risk premium, the following must be provided:

a) Commercial premium or rate formulas: The formula or procedure used to calculate the commercial premium or rate must be

accurately indicated.

b) Administrative costs: The value(s) or plan for administrative expenses that will be part of the commercial premium or rate must be

indicated.

c) Distribution costs: The value(s) or plan for distribution costs that will be part of the commercial premium must be indicated.

d) Profit margin: The value(s) or plan for the profit margin that will be part of the commercial premium or rate must be indicated.

e) Surcharges, discounts, shares or other benefits for the fee premium: Any surcharge or discount to be applied to the commercial

premium or rate based on an increase or decrease in the distribution costs, the administrative costs, or the profit margin as a

consequence of a determined circumstance must be indicated.

f) Any other value considered to be part of the commercial premium or rate must be indicated.

All the parameters, symbols and concepts used in the technical note must be fully defined. The symbols, parameters, or concepts

pertaining to securities that must be estimated must be defined and expressed in algebraic terms regardless of whether a conceptual

explanation is provided for them or not.

The symbols that express algebraic operations for addition, subtraction, multiplication, division, roots, exponentials, logarithms,

derivations, integration, and the mathematical and actuarial symbols must be expressed in commonly used notations.

If the actuary establishes his or her own symbols, their meaning must be defined so they are not subject to any sort of interpretation that

may lead to an error, confusion or lack of definition.

H. CURRENT RISK PROVISION

The procedures, formulas, and parameters used to calculate the current risk provision by policy will be indicated:

a) For life, damage, and accident and illness policies lasting one year or less, the risk provision in place in each policy will be

determined based on an assessment of the risk provision in place. The calculation formula will be specifically indicated.

b) For life insurance lasting more than one year, the calculation formula for the mathematical provision must be specifically indicated

for each policy. For life insurance lasting less than one year, the value of the administrative expenses to be used to calculate the

administrative expense provision that will be part of the risk provision in place in each policy must be indicated. Likewise, the

acquisition cost for the first year that will be used to calculate the loss in the first year that will be applied to the calculation for the

mathematical provision for each policy, as the case may be, must be indicated

c) For damage and accident and illness policies that last more than one year, the procedure used to calculate the risk provision in

place in each policy must be indicated, taking into account that the provision must be in line with the applicable standards so the

provision must be calculated as a function of the annual payment for the year that the policy is valid for, the annual payments

pertaining to future years and the yield calculated with the technical interest rate used to calculate the premium. The provision for

administrative expenses and the adjustment for adequacy that results from the assessment done with the method registered by the

entity for these purposes will be added.

d) The procedure for calculating the deferred premium that will be used to calculate the minimum mathematical provision for long-

term life insurance must be indicated.

e) The methods pertaining to the provisions must be registered in conformity with the applicable standards for creating the provisions.

The content of the technical note for an insurance product must be documented.

I. SHARE IN BENEFITS

The formula and parameters used to calculate, as the case may be, the benefits, as well as the formula for calculating the benefit share

provision will be indicated.

J. GUARANTEED VALUES

The formulas for calculating the guaranteed values to be provided will be indicated.

K. OTHER RELEVANT TECHNICAL ISSUES

The following relevant technical issues, as the case may be, must be indicated:

1. For insurance policies that offer yields linked to the provision, the procedure used to calculate the yields in conformity with the

applicable standards must be defined. In addition, the formula for calculating the pertinent provision must be stated.

2. For health and major medical expense insurance, where there are coverage types with no ensured amount that limits the amount of

the insurance company's liability, the allowances for the maximum probable loss (MPL) for each insured risk must be included.

The maximum probable loss must be a value where, for each policy or insured risk, the probability of a claim being filed that

exceeds that value is not very significant. The maximum probable loss may be determined in conformity with the procedures that

are indicated below:

a. As the estimated cost of a claim that might be produced when assuming the worst case scenario for an accident or illness

occurring that implies affecting the coverage types that underwrite the product in question. This cost may be determined by a

doctor based on the theoretic value of the cost of medical services that would be used by the insured to restore the insured

back to health. When this criterion is applied, empirical evidence may be used for accidents occurring in the local or foreign

market.

b. As the estimated cost with the entity's own accident experience or the market's experience, it will be built as a function of the

accumulated probability F(X), associated with amount of the individual claims. The value of the maximum probable loss will

be determined as X amount such that, the probability of a claim higher than that amount is less than 2.5%. In such a case, the

institution must show that the statistics pertaining to the experience used is adequate.

V. TECHNICAL NOTE COMPLEMENTARY INFORMATION

A. TECHNICAL NOTE PROCEDURES AND REFERENCES

All the procedures and parameters used must be expressly entered in the contents of the technical note. Without prejudice to the above,

to show the reliability of the proposed procedures, the actuary may provide references to the sources of the information used.

Likewise, bibliographic references may be made to back up and provide the foundation for a procedure theorem, or special theory to be

applied to the product that is submitted for registration. Images of the part of the document or book being referenced may be attached.

B. MAIN RISK COMPLEMENTARY BENEFITS

Entities may register additional benefits that are associated with the basic coverage types registered for other products by means of

independent applications where said association must be indicated. In such a case, the documents related to the additional benefit being

registered must be attached.

C. PRODUCT PACKAGE

Entities may prepare, register and commercialize insurance products that consist of grouping together and including, in a single insurance

contract, the risk coverage types that may pertain to one or more insurance branches or lines as described in Appendix 1.

In such cases, the package may be registered by using the technical notes and contractual documentation for products previously

registered with the Superintendency or by submitting the technical notes pertaining to each of the coverage types that include the product

package and contractual documentation prepared exclusively for the product package involved.

For model contracts, if there is any reference to the technical notes and contractual documentation for products that were previously

registered, the aspects contained in the documentation that may be negotiated must be specified.

1. To register the product package made up of products that were registered previously, the following will be observed:

a. Products registered previously will be understood to be those products where 30 business days have passed. This is the

period of time that the Superintendency has to do a review that resulting in the product not being suspended.

b. For this type of product, there is no need to submit the technical notes for registration by virtue of the fact that the

premiums and other product package elements must be the premiums that were registered in the technical notes for the

previously registered products. Therefore, as part of the registration process, the entity must indicate the relationship of

the products that make up the product package involved.

c. Regardless of the above, the consolidated contractual documentation that will be used in the product package must be

sent for registration. The different clauses in the consolidated contractual documentation must pertain to the clauses

established in the contractual documentation for each of the previously registered products.

d. The consolidated contractual documentation that will be used in the product package must precisely indicate the

contractual conditions that will be generally applicable to all the coverage types and those that will be specifically

applicable to each of the coverage types that make up the policy package in line with the previously registered general

conditions.

e. The legal opinion must indicate that the clauses in the consolidated contractual documentation pertain to those clauses

in the contractual documentation for the previously registered products.

f. In such cases, including the congruence analysis will not be required.

2. To register product packages made up of products not to be used or that do not have a technical note and contractual

documentation for previously registered products for all the coverage types that make up the product package, the following

will be observed:

a. A technical note that includes each of the coverage types for the product package involved must be submitted under

the same terms as for the registration of products not considered to be a product package, and they will be submitted at

the time of registration.

b. The consolidated contractual documentation for the product package that is made up of each of the coverage types that

make up the product package must be submitted.

c. The consolidated contractual documentation that will be used in the product package must precisely indicate the

contractual conditions that will be generally applicable to all the coverage types and those that will be specifically

applicable to each of the coverage types that make up the product package.

d. The congruency analysis and the legal opinion must be performed under the same terms as for registering products

that were not considered as a product package and will be submitted at the time of registration.

When dealing with product packages made up of products that were previously registered, if any of the previously registered

technical notes or contractual documentation used as a basis is modified, the entity must immediately update and replace the

registration for the pertinent product package. If the entity does not perform the aforementioned update, the product package

involved will be considered to have been revoked.

VI. CONTRACTUAL DOCUMENTATION

The contractual documentation for models of the adhesion contracts and the additional independent clauses that are part of the contracts that

may be necessary for operations must be submitted. These documents include: applications, cover sheets, certificates, consent forms,

questionnaires, premium payment receipts, and any documents that must be signed by the contracting party or the insureds.

For products commercialized as model contracts, in addition to the contents of the preceding paragraph, the following must be complied with:

a) Provide the general format or model with all their clauses. If the product references the clauses in a previously registered product, a

statement must be made to that end.

b) Based on the model provided and its contents, precisely indicate which clauses or items are subject to change during the procurement

process.

c) Specify whether the individual conditions for this product pertain to the conditions for a product that was already registered. If not,

the form for the pertinent individual conditions must be provided.

d) Explain whether the rest of the contractual documentation for the registered product will be used for this product. If not, the

pertinent documentation must be provided.

1. Life and accident and illness insurance that contains the item for designating beneficiaries must include warning text under the following

terms:

"Warning:

In case the insured would like to appoint beneficiaries who are under age, a representative of legal age should not be indicated to receive

the compensation on behalf of the minor children.

The foregoing is based on civil laws that provide for the way guardians, executors, representatives of heirs or other similar positions are

designated and the insurance contract is not considered to be an appropriate instrument for making such designations.

Any designation of an adult to represent minor beneficiaries while they are under age may legally imply that the adult will be appointed to

be the beneficiary. In any case, the adult will only have a moral obligation since the beneficiaries designated in an insurance contract are

granted the unconditional right to receive the insured amount."

2. For debtors' insurance that is taken out at the urging of the creditors so the outstanding credit balance is covered when the insured credit

recipients die or are totally or permanently disabled, the following must be observed:

a. The ways that the insured credit recipient will receive a copy of the insurance policy or certificate and a description and amount of

each one of the included coverage types must be indicated in the policies.

b. The insurance policies and certificates that set a stipulated insured amount as being a liquid amount

that may be adjusted in conformity with some indicator or not, clauses must be inserted that that clearly establish:

i. That if the creditor is designated as the beneficiary, the creditor will have the right to be paid an amount up to the equivalent

of the outstanding credit balance but without exceeding the agreed upon insured amount.

ii. That if the agreed upon insured amount exceeds the amount of the outstanding balance when an accident occurs, the

remainder will be paid to the insured borrower, to the borrower's successors or to the borrower's beneficiaries other than the

creditor, as pertinent.

c. Clauses must be inserted into the policies and certificates that refer to point 2 above, and into the policies and certificates that agree

that the insured amount will be a quantity equivalent to the outstanding balance without setting a liquid amount to clearly establish:

i. That the insured borrower or the borrowers' successors will have the right to demand that the insurance company pay the

insurance beneficiary lender the amount of the outstanding balance underwritten by the insurance, plus any accessory items.

ii. That the insurance company must notify the insured borrower and the borrower's beneficiaries, as pertinent, of any decision

whose purpose is to rescind or nullify the insurance contract to be able to enforce actions that safeguard the borrower's and

the borrower's beneficiaries' interests and, among other things, for them to be able to exercise their right for the insurance

company to pay the outstanding balance amount to the beneficiary creditor.

iii. That the insured borrower or the borrower's beneficiaries must report their residence address to the insurance company so

that the insurance company, if need be, may serve notification of the decisions indicated in the preceding section.

d. The following rules will be applicable to group insurance policies:

i. The individual group policy conditions must mention that the contracting party for the group insurance must inform the

insureds or other legitimate stakeholders about the insurance contract and its conditions or modifications and include

the following mandatory legend: "The contracting party assumes the liabilities that arise from its actions as the party

taking out the group insurance."

ii. The insurance entity must provide a coverage certificate to the insured that contains the minimum information about the

group policy number, the product registration number issued by the Superintendency, the effective period, the premium

amount, and the description and amount of each of the included coverage types. In addition, the insured may request

that a copy of the general and individual conditions that make up this insurance contract be provided. The insurance

entity must provide the insured with a certificate of coverage within a period of three business days after the request for

addition to the group contract when it involves an automatic addition. When a selection process is involved, the deadline

will begin upon acceptance.

iii. The preceding obligations will also be applicable to parties who, without being insureds themselves, have an interest in

the insurance due to having agreed to finance the premium payment or due to having to fulfill the obligations and

charges in the policy.

iv. Taking out a group policy does not exempt the insurance agents and brokers from their obligations as intermediaries in

relation to the insureds that are individually included in the policy.

v. When dealing with insurance policies associated with loans given to consumers who are clients of financial entities in

general, if the entity that provides the loan acts as the contracting party for the insurance in contributory mode, the

insurance entity must ask the financial entity for an express statement signed by the insured who took out the loan to

authorize that entity and to add it to the group policy. This instruction must indicate that the debtor insured is aware that

the debtor may take out insurance by itself directly from any insurance entity or through any insurance broker or agent in

the country. Without this instruction, under the indicated terms, the insurance entity may not add a debtor insured for a

determined loan to the group policy taken out by the financial entity that provided the loan. This does not apply to non-

contributory mode, in other words, when the financial entity pays the premium with its own funds.

vi. If it is contributory mode, any full or partial share in the policy benefits due to an accident or financial yield must be

reflected in the premium that the debtor insured is paying in proportion to the debtor insured's contribution. If it is not

contributory mode, the share in the benefits will depend on the contractual conditions that were agreed to.

vii. The insurance recipient's own actions related to adding the debtor insured to a group policy do not constitute insurance

intermediation.

3. Major medical insurance must include the criteria indicated below:

a. The contracting parties must indicate the sequence for applying the deductible and co-insurance in combination with the insured amount when paying compensation for an accident in the pertinent policy text in all individual, group, or new issuance group contracts.

b. An endorsement for group insurance based on proprietary experience may be created. The endorsement should be for policies with new effective periods and may be registered with the Superintendency for adhesion contracts. The endorsement should establish that, if the policy is not renewed with the same insurance company, the insurance company's obligation to pay for initial claims or complementary claims for expenditures for covered medical expenses will be limited when they are made by the insured prior to the end of the policy effective period. Any expenditures made after said effective period will be excluded solely in this case.

The preceding section is conditioned on fulfillment of the following requirements:

i. The policy text should state the financial implications that may result from for the insureds as a consequence of the contracting

party's decision to change its insurance from one entity to another.

ii. The requirements mentioned in section a) above must be communicated to the insureds in writing.

4. Since the compensation payment obligation is not subject to any condition, the entities that provide automotive civil liability coverage with an applicable deductible must be held liable for any damages that are caused without being subject to a deductible pre-payment.

5. The font to use in the policies, endorsements, additional clauses and other contractual documentation that establish the exclusions must not be smaller than 12 point bold.

6. To explain to the applicant for insurance that the simple fact that the application has been signed and delivered to the insurance agent or the entity is not a guarantee that the latter will accept entering into a contract or the proposed terms, unless it guarantees accepting the application, the entities must include the following text in no smaller than 12 point bold on all the insurance application forms:

"This document is only an insurance application; therefore, it does not represent any guarantee that it will be accepted by the insurance company or that, if it is accepted, the acceptance will totally agree with the terms of the application."

7. Insurance products with savings components with a provision that includes accrediting the investment yield must submit a specialized training program for registration as part of the insurance product's contractual documentation. The program should include the legal and regulatory framework for insurance and the product's technical characteristics and aspects that will be applied to parties involved in the commercialization chain. The training programs must include a syllabus that includes the contents by unit, module, and subject.

7 bis. Self-issued insurance policies:

a. The self-issued policy holder must be given the ability to unilaterally revoke the contract being underwritten in relation to the right to retract the contract with no need to indicate the reasons and without any penalty within a period of 5 business days after the date that the insurance policy was acquired so long as no harmful event has occurred that the policy covers. The deadline set forth herein is the minimum, without prejudice to the insurance entities' right to establish a longer period of time in the policy to the benefit of the insured. Once the deadline herein or the deadline stipulated in the policy has passed, the contract may only be revoked when the parties consent to the revocation under the terms and conditions established in the pertinent policy.

b. The right to retraction will not be applicable to self-issued insurance contracts for travel assistance once the trip begins. Nor will it be applicable to self-issued insurance contracts whose effective period is equal to or less than five business days. This is without prejudice to the insurance entities' right to make it possible for insurance policies or internal policies to issue that right for longer periods of time to benefit the insured or to even not have deadlines.

c. The ability to unilaterally revoke the contract must be exercised by the policy holder by sending a communication addressed to the insurance entity through long-lasting support that is available to and accessible by the insurance entity that allows for a record of the notification. This communication must be issued by the self-issued insurance policy holder prior to the deadline indicated in section a) and will be issued according to the instructions established in the policy.

d. Starting on the date that the communication referenced in section c) above is issued, the risk coverage provided by the insurance entity will end. The insurance policy holder will have the right to have any premium that may have been paid returned to the policy holder.

e. The insurance entity will have a period of 10 business days beginning on the date that the communication is received about the unilateral contract revocation to return the premium amount. The premium return procedure must be simple and free of obstacles for the policy holder and must be made part of the policy.

8. The documentation must contain the following requirements:

a. Be written in Spanish with a font that is easily legible.

b. Not contain stipulations that do not follow the contents of the legal provisions that are applicable to them and not establish obligations or conditions that are not equitable or that are damaging to the contracting parties, insureds or beneficiaries.

c. Establish the scope, terms, conditions, exclusions, limitations, franchises or deductible and the rights and obligations pertaining to the contacting parties, insureds or beneficiaries.

d. Include the issues and clauses needed in conformity with the applicable legal provisions and the Superintendency's general guidelines.

e. Be in full agreement with the technical note.

9. Declaration of product registration

The policy cover sheets should show the application form with an explanatory brochure, as the case may be, on the last page of the general conditions, with the certificates or endorsements stating that the product being offered to the public is registered with the Superintendency, by including the following legend, which must be submitted for registration purposes:

"The contractual documentation and technical note making up this product are registered with the General Insurance Superintendency as set forth in Article 29, section d) of the Insurance Market Regulatory Law, No. 8653, as registration number ____________ dated ___________."

10. The following statement must be added to adhesion contracts negotiated in model contract mode:

"This model contract contains the coverage types, exclusions, and other contractual terms that have been predetermined by the insurance company based on its experience and professionalism without detriment to the fact that the parties have mutually agreed to be able to include, based on the principle of free negotiation, any clauses that they deem to be appropriate because of the risk type and line of business."

11. If the policy limits the right to freely choose auxiliary service providers related to the products that provide a service directly to the insured or beneficiary, the contract must clearly reveal the conditions for gaining access to providing the service and how the insurance policy holder, the insured, or beneficiary may obtain current information on auxiliary service providers at any time.

VII. CONGRUENCY ANALYSIS

To prepare the congruency analysis, the actuary and the entity's attorney who sign the analysis must verify that the obligations assumed in the product's contractual conditions are reliably backed using the actuarial method described in the pertinent technical note. In addition, the referenced analysis must list the most relevant contractual issues that in the actuary's and the attorney's opinion will have a repercussion on the plan's or the contract's technical design.

When the policy pertains to a model contract and the product references a previously registered product, it should indicate whether the congruency analysis for the registered product applies to the product being commercialized as a model contract. If it does not, the pertinent congruency analysis must be submitted.

____________________

56 Repealed by section 2, Article 9, of the minutes of meeting 1131-2014, held on October 27, 2014, published in La Gaceta number 228 on November 26, 2014

56 APPENDIX 16

FORM FOR ACCREDITING ACTUARIAL AND LEGAL PROFESSIONALS

(Repealed by section 2, Article 9, of the minutes of

meeting 1131-2014, held on October 27, 2014, published in La

Gaceta 228 dated November 26, 2014)

Documentation required for accrediting actuarial and legal professionals.

I. LEGAL BASIS

A. THE INSURANCE MARKET REGULATORY LAW, LAW 8653.

1. For policy registration: Articles 25 k and 29 d.

II. APPLICATION FORM

III. Place and date

General Insurance Superintendency

In my capacity as the (general manager or equivalent) of (name of insurance entity), I would like to

accredit the signatories to the documentation required to register the insurance products, according to

the following:

a) Actuaries who signed the technical note and the congruency analysis.

b) Attorneys who signed the legal opinion, the contractual documentation, and the congruency

analysis.

In addition, I declare that these people's professional profiles have been evaluated and they meet the

technical suitability requirements for signing the documents that back up the application for registration of a model policy.

Signature

Name of professional

Identification or professional association membership

number

Registration transaction

(inclusion / exclusion)

Profession Type

(a, b)

____________________

57 Repealed by Section II, paragraph 1, section l) of the minutes of meeting number 1043-2013 held on

May 21, 2013. Effective as of publication. La Gaceta number 115 dated June 17, 2013.

APPENDIX 1757(REPEALED)

FORM FOR REGISTERING AUXILIARY SERVICE PROVIDERS LINKED TO INSURANCE POLICIES

Form for the minimum information for registering auxiliary service providers linked to insurance policies.

I. LEGAL BASIS

A. THE INSURANCE MARKET REGULATORY LAW, LAW 8653.

1. For policy registration: Article 18.

II. FORM FOR REGISTERING AUXILIARY SERVICES I, in my capacity as (General Manager or equivalent) for (name of the insurance entity) would like to

request that the following auxiliary service providers be registered:

Signature

Provider name

Personal or corporate

identification number

Professional association code,

if applicable.

Services

registered Address

Telephone

number(s)

Email and web page

Likewise, I would like to request that the following auxiliary service providers be excluded:

Provider name

Personal or corporate

identification number

Professional association

code, if applicable.

Services

registered

Professional association registration

code

Address Telephone

number(s)

Email and web page

APPENDIX 18

REQUIREMENTS FOR REGISTERING CROSS-BORDER INSURANCE PROVIDERS

Requirements for registering insurance entities and intermediary service or auxiliary service providers

I. LEGAL BASIS

A. THE INSURANCE MARKET REGULATORY LAW, LAW 8653.

1. For registration: Article 16.

2. For reasonable regulation: Article 16.

II. DOCUMENTATION TO BE ATTACHED TO THE APPLICATION FOR INSURANCE ENTITIES

a. Letter of application for registration signed by the applicant or the legal representative. The

signature must be authenticated by a notary public. The letter must indicate the name of the entity

and an address and fax number for service of notifications. In addition, the pledge that Costa Rica

subscribed to and the specific standards in the international treaty that it invokes must be

indicated.

b. A letter issued by the competent authority indicating that the entity is a supervisor in its

jurisdiction of origin and is authorized to perform the proposed operations.

c. Guarantee letter issued by a top ranked banking entity, liability insurance or, in the absence

thereof, a deposit statement from the Central Bank that guarantees the minimum effective period

on the date of the application for the amount and under the conditions defined in this Appendix.

d. Documentation for the organizational structure, the human and technological resources that make

it possible for the services to be provided appropriately.

e. Current risk rating issued by a risk rating company that is recognized internationally.

f. Detailed description of each of the products to be supplied to

the Costa Rican market and the market penetration plan.

g. Production plan for quarterly premiums for a minimum of two years.

III. DOCUMENTATION THAT SHOULD ACCOMPANY THE INTERMEDIARY REGISTRATION APPLICATION

a. Letter of application for registration signed by the applicant or the legal representative. The

signature must be authenticated by a notary public. The letter must indicate the name of the entity

and an address and fax number for service of notifications. In addition, the pledge that Costa Rica

subscribed to and the specific standards in the international treaty that it invokes must be

indicated.

b. A letter issued by the competent authority indicating that the entity is a supervisor in its

jurisdiction of origin and is authorized to perform the proposed operations.

c. Guarantee letter issued by a top ranked banking entity, liability insurance or, in the absence

thereof, a deposit statement that guarantees the minimum effective period on the date of the

application for the amount and under the conditions defined in these regulations.

d. Documentation for the organizational structure and the human and technological resources that

make it possible for the services to be provided appropriately.

e. Detailed description of each of the products that will be supplied in the Costa Rican territory and

the market penetration plan.

f. Document that evidences the risk rating for each of the insurance entities whose products will be

commercialized. Current risk rating for the intermediary and, as the case may be, the insurance

entity issued by a risk rating company that is recognized internationally. When dealing with direct

insurance policies issued abroad that will be supplied to the national territory that are allowed by

the pertinent international treaty or with reinsurance issued abroad, a letter issued by the

insurance entities abroad indicating that the intermediary maintains commercial relationships with

that entity. In addition, the information about premium production with said entity, the insurance

categories to which they pertain and the geographic distribution must be detailed. Whether the

intermediary works in the name or on behalf of the entity or just in the intermediary's name must

be specified.

g. Production plan for quarterly premiums for a minimum of two years.

IV. DOCUMENTATION THAT MUST ACCOMPANY THE AUXILIARY SERVICE PROVIDER APPLICATION

a. Letter of application for registration signed by the applicant or the legal representative. The

signature must be authenticated by a notary public. The letter must indicate the name of the

provider and an address and fax number for service of notifications. In addition, the pledge that

Costa Rica subscribed to and the specific standards in the international treaty that it invokes must

be indicated.

b. When dealing with professional activities that are regulated, evidence of membership in the

pertinent professional association must be evidenced.

c. Detailed description of the auxiliary services to be supplied to the national territory.

V. MINIMUM GUARANTEE

The minimum guarantee amount will be the higher of the following:

a. 2.5% of the total premiums sold in the last 12 months.

b. 30,000 development units.

APPENDIX 19

REQUIREMENTS FOR REGISTERING REPRESENTATIVE OFFICES

Requirements for registering representative offices of foreign entities.

I. LEGAL BASIS

A. THE INSURANCE MARKET REGULATORY LAW, LAW 8653.

1. For registration: Article 17.

2. For business names: Article 17.

II. DOCUMENTATION THAT SHOULD ACCOMPANY THE REPRESENTATIVE OFFICE REGISTRATION APPLICATION

a. Letter of application for registration signed by the applicant or the legal representative. The

signature must be authenticated by a notary public. The letter must indicate the name of the entity

and an address and fax number for service of notifications.

b. Letter issued by the competent authority indicating that it is supervised in its jurisdiction of origin.

c. Description of the activities that the representative office will carry out.

d. Foreseen address for the office and information about the person(s) responsible for reporting to the

Superintendency.

_____________________

58 Repealed by section 2, Article 9, of the minutes of meeting 1131-2014, held on October 27, 2014, published in La Gaceta number 228 on November 26, 2014

58APPENDIX 20

REQUIREMENTS FOR REGISTERING MODEL POLICIES SUBJECT TO THE CROSS-BORDER REGIMEN

(Repealed by section 2 of Article 9 of the minutes of meeting 1131-2014, held on October 27, 2014, published in La Gaceta issue 228 dated November 26, 2014)

Requirements for registering model policies subject to the cross-border regimen for a country with which Costa Rica has made pledges by subscribing to a current international treaty.

I. LEGAL BASIS

A. THE INSURANCE MARKET REGULATORY LAW, LAW 8653.

1. For policy registration: Articles 25 y 29, d.

II. DOCUMENTATION THAT MUST ACCOMPANY THE APPLICATION

a. Letter of application for registration signed by the applicant or the legal representative. The signature must be

authenticated by a notary public. The letter must indicate the name of the entity and an address and fax number for service of notifications. In addition, the pledge that Costa Rica subscribed to and the specific

standards in the international treaty that it invokes must be indicated.

b. Contractual documentation.

c. Statement issued by the supervisor of origin that demonstrates that the issuer is supervised in its jurisdiction

of origin.

d. Official translation of the policy.

III. INFORMATION LEGENDS REQUIRED The intermediary must include, as part of the contractual documentation, an explanatory document that contains at least the following: A. Product features: The product's technical and contractual characteristics must be established:

a. Product name: The name that the insurance entity will use to identify the product will be indicated.

b. Insurance entity issuing the policy and the applicable legal jurisdiction.

c. Product seasonality: The number of years or shorter period of time that the contract will be effective must be indicated.

d. Contract type: Whether the technical note pertains to and adhesion contract or not must be indicated.

B. Description of coverage types: The covered risks, benefits, deadlines and other technical issues that characterize the product coverage type forms must be indicated:

a. Description of the basic coverage type: A clear description of the risk covered by the entity must be provided for the type or types of goods that are covered, the benefit, or the compensation that will be provided in case of an accident, as well as any circumstance under which such coverage types or benefits

will change or vary during the insurance effective period.

b. Description of additional coverage types: Each of the additional and optional coverage types that the product will include or that may be procured by means of an express agreement must be indicated, along with the risk covered by the entity, the good being covered, and the benefit or compensation that will be provided in case of accident in each of said coverage types.

____________________ 59 Modified by Section II, paragraph 1, section m) of the minutes of meeting number 1043-2013 held on

May 21, 2013. Effective as of publication. La Gaceta number 115, dated June 17, 2013.

c. Description of service coverage types: The type of services that the products will include and the conditions applicable to them must be indicated.

C. Declaration of registration of the applicable product and jurisdiction.

The policy cover sheets should show the application form with an explanatory brochure, as the case may be, on the last page of the general conditions, with the certificates or endorsements stating that the product being offered to the public is registered as a cross-border product with the Superintendency, by including the following legend:

"The contractual documentation making up this product are registered with the General Insurance Superintendency as set forth in Article 29, section d) of the Insurance Market Regulatory Law, No. 8653, under the registration number(s) _____________________ dated _______________________, based on the (name of the international agreement and number of the law that underwrites the registration). Since this is a product

that is sold across borders, any dispute related to this contract will be settled in the jurisdiction of (country). The registration for the policy in its jurisdiction of origin is the following (specify the pertinent information).

POLICY HOLDER SIGNATURE DATE"

The legend will be added in a legible font size.59

60APPENDIX 21

FORM FOR REGISTERING SELF-ISSUED INSURANCE OPERATORS.

Form with the minimum information for registering self-issued insurance operator services.

I. - LEGAL BASIS

A. THE INSURANCE MARKET REGULATORY LAW, LAW 8653. 1. For the definition: Article 24.

II. FORM FOR REGISTERING SELF-ISSUED INSURANCE OPERATORS.

I, in my capacity as (General Manager or equivalent), for (name of the insurance entity) would like to request

that the following self-issued insurance operators be registered:

Add legal representative information

Likewise, I would like to request that the following self-issued insurance operators be excluded:49

Name of the

operator and

corporate

identification

number

Name, document

and legal

representative

identification

number

Type of

operator

(exclusive/non-

exclusive)

Corporate

identific-

ation

number

Products

commercialized Address Telephones

Email and

web site

60 Appendix 21 was added by Section II, paragraph 6, of the minutes of meeting 886-2010, Article 12, dated October 15, 2010. Effective

as of publication. La Gaceta number 217 dated November 9, 2010.

Name of the

operator and

corporate

identification

number

Name, document

and legal

representative

identification

number

Type of

operator

(exclusive/non-

exclusive)

Corporate

identific-

ation

number

Products

commercialized Address Telephones

Email and

web site

Signature

61APPENDIX 22

REGISTRATION OF MANDATORY INSURANCE POLICIES

Documentation required for registering mandatory insurance policies and technical notes.

I. LEGAL BASIS

INSURANCE MARKET REGULATORY LAW, Number 8653

For policy registration: Articles 25 k and 29 d.

II. DOCUMENTATION THAT SHOULD ACCOMPANY THE APPLICATION FOR REGISTRATION OF

MANDATORY INSURANCE

1. A letter applying for registration of mandatory insurance signed by the entity's legal representative or

the person delegated by the legal representative to submit the application.

2. Notary certification of the minutes of the governing body that has passed a motion to offer mandatory

insurance.

3. The technical note underwriting the mandatory insurance according to the minimum format and

content established in Section IV of this Appendix.

4. The contractual documentation according to the contents of Section V of this Appendix.

5. The legal opinion that certifies that the contractual documentation is in line with the contents of Law

8653 and the standards applicable to the mandatory insurance.

6. An analysis of whether the technical note is in line with the technical standards for insurance for

MWC and the contractual documentation.

7. 62The minimum information for registering auxiliary services based on the contents of Appendix 17

(mandatory only if the policy limits the consumer in relation to the freedom to choose the auxiliary service

provider for damage repair or service provision). Repealed by Section II, paragraph 1, section o) of the

minutes of meeting number 1043-2013 held on May 21, 2013.

____________________

61Added by Article 8, section 3 of the minutes of meeting 894-2010, held on December 10, 2010. Effective as of publication. La Gaceta

number 248 dated December 22, 2010.

Modified by Section II, paragraph 1, section n) of the minutes of meeting number 1043-2013 held on May 21, 2013. Effective as of

publication. La Gaceta number 115 dated June 17, 2013.

62Overturned by Section II, paragraph 1, section o) of the minutes of meeting number 1043-2013 held on May 21, 2013. Effective as of

publication. La Gaceta number 115, dated June 17, 2013.

8. Description of the product distribution channel.

III. FORMAL REQUIREMENTS FOR REGISTERING MANDATORY INSURANCE

1. The technical note that must be signed by an actuary. The cover sheets for the technical note must show

the following legend:

"I, (name of professional), the bearer of national identification cards ____________________ and Costa Rican Association of Professionals in Economic Sciences number ______________________, bear witness, based on my professional responsibility, to the fact that the methodology for determining the rate, provisions and other technical elements considered in this technical note are in line with the contents of the Insurance Market Regulatory Law, the Law on Promoting Competition and Effective Consumer Defense and (the Labor Code or the Transit Law) and its bylaws."

2. The model contract, which must be signed by the person responsible for preparing the legal opinion that

backs it.

3. The legal opinion that certifies that the contractual documentation is in line with the contents of the

Insurance Market Regulatory Law and the specific standards for mandatory insurance for insurance

contracts. The document must contain the following legend:

"I, (name of professional), the bearer of national identification card number _________________________ and Costa Rican Bar Association number ________________________________, bear witness, based on my professional responsibility, that the contractual documentation for (mandatory insurance name) is in line with the contents of the Insurance Market Regulatory Law, the Law on Promoting Competition and Effective Consumer Defense and (the Labor Code or the Transit Law) and its bylaws."

4. The analysis of whether the technical note is in line with the technical standards for insurance, the contractual documentation, and the specific standards for mandatory insurance. This document will be

prepared and signed by the actuary in charge of preparing the technical note and by the entity's attorney.

They must verify that the obligations set forth in the insurance policy's contractual conditions and technical

note are reliably backed by the actuarial methods described in the pertinent technical note. In addition, the

referenced analysis must list the most relevant contractual issues that, in the actuary's and the attorney's

opinion, will have a repercussion on the plan's or the contract's technical design. The congruency analysis must include the following legend:

"We, the undersigned (actuary name), the bearer of identification card number __________________ and code _______________________ and (name of the institution's lawyer) the bearer of identification card number _________________________ and bar number _____________________, based on our professional responsibility, swear that we have verified that the obligations assumed in the contractual conditions for the (mandatory insurance name) are faithfully backed by the actuarial methods described in the pertinent technical note."

IV. FORM FOR AND THE MINIMUM CONTENT OF THE TECHNICAL NOTE

A. Product features:

The technical and contractual features for the insurance must be established and the laws and standards

that govern it and a brief summary of the objective that this insurance fulfills must be indicated.

B. Description of coverage types

The risks covered, insured amounts, benefits, deadlines, and other technical issues that characterize the

forms of product coverage must be indicated. The basic coverage type, the additional coverage types, and the

service coverage types (if they exist) must be submitted.

a) Description of basic coverage type: A clear description of the risks covered by the entity must be provided

for the type or types of goods that are covered, along with the benefit or the compensation that will be

provided in case of an accident, as well as any circumstance under which such coverage types or benefits will

change or vary during the insurance effective period. The basic coverage types will pertain solely and strictly

to the benefits established by law.

b) Description of additional coverage types: Each of the additional and optional coverage types that the

product will include or that may be procured by means of an express agreement must be indicated, along with

the risk covered by the entity, the goods or types of goods being covered, and the benefit or compensation that

will be provided in case of accident in each of said coverage types. These coverage types must be voluntary for

the contracting party.

c) Description of service coverage types: The type of services that the product will include must be indicated,

such as: medical, legal, automotive, trip, or other types of assistance, as well as the conditions for using

them.

C. Technical theory

The demographic theories and tables on mortality, morbidity, disability and any other issues that will be used

to calculate the risk premiums or rates must be indicated and included. The tables on insured mortality established by the National Financial System Supervisory Council are an exception since they must indicate

the data needed for identification and verification, such as country, author, year, and possible web page.

D. Statistical information

The statistical information that will be used must be indicated and included, indicating the necessary data for

verification and identification such as country, author, year and web page (if applicable).

d) As part of the technical note, the consolidated statistical information data must be included that were

used to determine the values for frequency, severity,

average amounts or any other premium parameter or risk rate. The entity must indicate any material issues

related to modifying, cleaning up and transforming the original statistical data.

a) The policies must indicate and include the tables on frequency, severity, average amounts, morbidity,

accident index, or any other pertinent fact that will be used to calculate the risk premiums or rates. The

source must also be indicated.

b) The assumptions used to estimate the frequency, severity, accident index or any other information that

will be applied to calculate the risk premiums and rates must be indicated.

c) If reinsurer rates are adopted for additional coverage types, the reinsurance contract that covers the risk

in question must be submitted.

d) When there is no information for the entity or the insurance market that is adequate and reliable in

terms of the contents of the actuarial practice standards to be able to calculate the mandatory insurance

premium or rate, experimental rating schemes may be proposed. In such cases, the product technical note

must indicate that it is an experimental premium or rate and that it will be reviewed at the end of one year.

E. Financial theories

To calculate the premiums or rates, the following must be submitted:

a) Technical interest rate: The technical interest rate will be indicated that will be used to calculate the

premiums and or rates. Likewise, the assumptions related to inflation, wage increases, or income increases or

any other issue to be used must be indicated.

b) Foundations: The technical interest rate amount being proposed to be used must be justified in

conformity with the principles established for those purposes in the actuarial practice standards and the

current standards on technical provisions.

c) No technical justification will be required for the technical interest rate for calculating the premiums or

rates proposed by the regulatory entity.

F. Risk premium or rate procedures and foundations

The procedures, formulas and parameters used to calculate the risk premium or rate will be indicated.

a) Risk premium or rate formulas: The formula or procedure used to calculate the risk premium or rate

must be indicated.

b) Foundations: If formulas that were specifically designed by the actuary, mathematical theorems,

probability functions,

credibility theory, or stochastic processes are proposed for application, the foundations must be

indicated.

c) Parameters: The parameter calculation value and form that are part of the risk premium or rate

calculation formulas or procedures must be indicated.

d) Deductibles, co-insurance and co-pays: For additional coverage types, the calculation formulas or the

deductible, co-insurance or co-pay amounts to be applied, as the case may be, must be indicated, as well as

the way the deductibles and co-insurance will be reflected in the risk premium or rate calculation.

e) Risk-based surcharges and discounts: Any surcharge or discount to be applied to the risk premium or

rate based on the allowances for a decrease or increase in the expected risk value as a consequence of a

determined circumstance or faced with the lack of statistical information based on qualitative foundations

that clearly explain the influence that the circumstance has on the insured risk must be indicated and

justified.

G. Commercial premium or rate procedures

The procedures, formulas, and parameters used to calculate the commercial premium or rate will be

indicated.

a) Commercial premium or rate formulas: The formula or procedure used to calculate the commercial

premium or rate must be accurately indicated.

b) Administrative costs: The value(s) or plan for administrative expenses that will be part of the

commercial premium or rate must be indicated.

c) Acquisition costs: The value(s) or plan for acquisition costs that will be part of the commercial premium

must be indicated.

d) Profit margin: For additional coverage types, the value(s) or plan for the profit margin that will be part

of the commercial premium or rate must be indicated.

e) Commercial premium or rate surcharges and discounts: Any surcharge or discount to be applied to the

commercial premium or rate based on an increase or decrease in the acquisition costs, the administrative

costs, or the profit margin for additional coverage types as a consequence of a determined circumstance must

be specified.

f) Any other value considered to be part of the commercial premium or rate must be indicated.

g) All the parameters, symbols and concepts used in the technical note must be fully defined. The

symbols, parameter, or concepts for values that must be estimated, must be defined and expressed in

algebraic terms regardless of whether a conceptual explanation is provided. The symbols that express algebraic operations for addition, subtraction, multiplication, division, roots, exponentials, logarithms,

derivations, integration, and the mathematical and actuarial symbols must be expressed in commonly

used notation. If the actuary establishes its own symbols, the meaning must be defined so it is not

subject to interpretation that may lead to error, confusion, or no definition.

H. Requested rates

The premiums or rates requested for the basic coverage type will be submitted based on the following

format:

I. Mandatory workers' compensation insurance: they must be submitted as a percentage with two

decimal points to be applied based on a mass calculation of wages in the following format:

WORKERS' COMPENSATION INSURANCE

CURRENT RATES REQUESTED BY THE PRIVATE SECTOR

BY ECONOMIC ACTIVITY

WORKERS' COMPENSATION INSURANCE

CURRENT RATE REQUESTED BY THE PUBLIC SECTOR

Economic activity

Current

commercial rate

Risk rate

requested (1)

Risk rate

requested with

discounts and

surcharges (2))

Commercial

rate requested

(3)

Commercial

rate requested

with discounts

and surcharges (4)

For columns, 1, 2, 3, and 4, a footnote or note at

the end of the charge must indicate the

parameters used in each column and the pages

where they are found in the technical note.

Risk group Public

institution

Current commercial

rate

Risk rate requested (1)

Risk rate

requested with discounts and surcharges (2)

Commercial rate requested

(3)

Commercial

rate requested with discounts and surcharges

(4)

The method used to establish the risk groups must be defined.

For columns, 1, 2, 3, and 4, a footnote or note at the end of the charge must indicate the parameters used in each

column and the pages where they are found in the

technical note.

2. Mandatory automobile insurance: To be submitted in colones in the following format:

MANDATORY AUTOMOTIVE INSURANCE

CURRENT REQUESTED RATES

The procedures, formulas, and parameters used to calculate the provisions applicable to mandatory

insurance will be indicated. The methods for the provisions must be registered in conformity with the

standards applicable to creating the provisions and the contents of the technical note must be

documented.

J. Technical note procedures and references

All the procedures and parameters used must be expressly entered in the contents of the technical

note. Without prejudice to the above, to show the reliability of the proposed procedures, the actuary

may provide references to the sources of the information used.

Likewise, bibliographic references may be made to back up and provide the foundation for a procedure

theorem, or special theory to be applied to the mandatory insurance that is submitted for registration. Images of the part of the document or book being referenced may be attached.

V. CONTRACTUAL DOCUMENTATION

The contractual documentation for models for the adhesion contracts and the additional independent

clauses that are part of the contracts that may be necessary for operations must be submitted. These

documents include: applications, cover sheets, certificates, consent forms, questionnaires, payment

receipts for

Vehicle type Current

commercial rate

Risk premium requested

Commercial rate

requested

Private

Light weight

Heavy weight

Motorcycles and scooters

Buses

Taxis

Special equipment

Procedures and foundations for the applicable provision.

____________________ 63 Repealed by Section II, paragraph 1, section o) of the minutes of meeting number 1043-2013 held on

May 21, 2013. Effective as of publication. La Gaceta number 115, dated June 17, 2013.

64 Modified by Section II, paragraph 1, section p) of the minutes of meeting number 1043-2013 held on

May 21, 2013. Effective as of publication. La Gaceta number 115, dated June 17, 2013.

premiums and all those documents that must be signed by the contracting party or insured.

1. Warning text must be included in the general insurance conditions for on-the-job risks and

mandatory automobile insurance using the following terms:

Warning:

In case the Insured would like to appoint beneficiaries who are under age, a representative of legal age

should not be indicated to receive the compensation on behalf of the minor children.

The foregoing is based on civil laws that provide the way guardians, executors, representatives of heirs or

other similar positions are designated and the insurance contract is not considered to be an appropriate

instrument for making such designations.

Any designation of an adult to represent minor beneficiaries while they are under age may legally imply

that the adult will be appointed to be the beneficiary. In any case, the adult will only have a moral

obligation since the beneficiaries designated in an insurance contract are granted the unconditional right

to receive the insured amount."

2. 63The following rules will be applicable to group insurance policies:

i. The individual group policy conditions must mention that the contracting party for the group

insurance must inform the insureds or other legitimate stakeholders about the insurance contract and its conditions or modifications and include the following mandatory legend: "The contracting party

assumes the liabilities that emanate from its actions as the party taking out the group insurance."

ii. The insurance entity must provide a coverage certificate to the insured that contains the minimum

information about the group policy number, the product registration number issued by the

Superintendency, the effective period, the premium amount, and the description and amount of each of the included coverage types.

iii. Taking out a group policy does not exempt insurance agents and brokers from their obligations as

intermediaries in relation to the insureds that are individually included in the policy.

(Repealed by Section II, paragraph 1, section o) of the minutes of meeting number 1043-2013

held on May 21, 2013.)

3. The following mandatory legend must be include in the policy's text:

"...Basic coverage for this mandatory insurance contract covers all the benefits regulated in conformity with

_____________________ (the Labor Code or the Transit Law) and its bylaws. Any clause in this contract that

does not follow the law, is absolutely null and void..."

4. The type to use in the policies, endorsements, additional clauses and other contractual documentation that establish the exclusions must be clear, highlighted, and legible.64

5. The documentation must contain the following requirements:

a. Be written in Spanish with characters that are easily legible.

b. Not contain stipulations that do not follow the contents of the legal provisions that are applicable to

them and not establish obligations or conditions that are not equitable or that are damaging to the

contracting parties, insureds or beneficiaries.

c. Establish the scope, terms, conditions, exclusions, limitations, franchises or deductible and the

rights and obligations of the contacting parties, insureds or beneficiaries.

d. Include the issues and clauses needed in conformity with the applicable legal provisions and the

Superintendency's general guidelines.

e. Agree fully with the technical note.

6. Declaration of product registration

The policy cover sheet must show the application form with an explanatory brochure, as the case may

be, on the last page of the general conditions, with certificates or endorsements stating that the product

being offered to the public is registered with the Superintendency, by including the following legend,

which must be submitted for registration purposes:

"The contractual documentation and technical note making up this product are registered with the General

Insurance Superintendency as set forth in Article 29, section d) of the Insurance Market Regulatory Law,

No. 8653, as registration numbers ___________________, dated _____________________."

7. Insurance technical note:

A technical note for insurance must be submitted that will contain the operating issues for applying the

rate, risk evaluation and surcharge or discount application based on the parameters for the authorized premium or rate, the operating procedure for periodic policy liquidation, the insured payroll report, and

other necessary details.

The insurance standards will also include, in conformity with Article 215 of the Labor Code, the rate

review methodology and criteria due to breach of the provisions in matters related to occupational

health, the number of employees exposed to such risks, and the accident history for the problem

employer.

____________________ 65 Added by Section II, paragraph 1, section Q) of the minutes of meeting number 1043-2013 held on

May 21, 2013. Effective as of publication. La Gaceta number 115 dated June 17, 2013.

8. If the policy limits the right to freely choose auxiliary service providers related to the products that

provide a service directly to the insured, beyond the contents of the special law that regulates specific mandatory insurance, the contract must clearly reveal the conditions for gaining access to providing

the service and how the insurance policy holder, the insured, or beneficiary may obtain current

information on auxiliary service providers at any time.65

____________________ 66 Added by Article 8, section 3 of the minutes of meeting 894-2010, held on December 10, 2010.

Effective as of publication. La Gaceta number 248 dated December 22, 2010.

66APPENDIX 23

AUTHORIZATION FOR MANDATORY INSURANCE PREMIUMS OR RATES

Documentation required for authorization for mandatory insurance premiums or rates.

I. LEGAL BASIS

THE INSURANCE MARKET REGULATORY LAW, LAW 8653.

For mandatory insurance: Transitory Rule of Law III.

II. DOCUMENTATION THAT SHOULD ACCOMPANY THE APPLICATION FOR REGISTRATION OF

MANDATORY INSURANCE

1. A letter applying for authorization for mandatory insurance premiums or rates signed by the entity's

legal representative or the person delegated by the legal representative to submit the application. If this

is the first time that authorization for premiums or rates is being requested, the application letter in

point 1 may include an application for registering the product in conformity with Appendix 22 of these

regulations.

2. Product documentation:

a) Technical note that upholds the rate based on the terms of Appendix 22.

b) If this is a review after the premium and rates have been established that does not imply any

changes in the contractual documentation or in the technical standards for insurance, just the

technical note that underwrites the product should be included. A statement must be submitted that

declares that the rest of the documentation did not have any changes.

c) For rate updates that are strictly in line with the registered methodology, just the requested rates

and the electronic file with the base information used and the calculations made must be submitted.

This electronic file must have the entity's legal representative's digital signature.

____________________ 67 Added by Article 8, section 3 of the minutes of meeting 894-2010, held on December 10, 2010.

Effective as of publication. La Gaceta number 248 dated December 22, 2010.

67APPENDIX 24

CANCELLING MANDATORY INSURANCE REGISTRATION

Documentation required for authorization for voluntary termination of mandatory insurance

I. LEGAL BASIS

INSURANCE MARKET REGULATORY LAW, Number 8653

For voluntary termination of mandatory insurance: Transitory Rule of Law III.

II. DOCUMENTATION THAT SHOULD ACCOMPANY THE APPLICATION FOR REGISTRATION OF

MANDATORY INSURANCE

A. DOCUMENTATION REQUIRED FOR AUTHORIZATION FOR VOLUNTARY CESSATION OF

MANDATORY INSURANCE

1. Application letter signed by the legal representative that requests authorization for termination of

mandatory insurance offers. The letter must specify the reasons behind the application for

authorization.

2. Certification issued by a notary public or the competent authority for the minutes of the

shareholders’ or associates' meeting or for the body with equivalent functions, stating final approval of

the action subject to authorization.

B. OPERATING PLAN FOR MANDATORY INSURANCE PORTFOLIO TRANSFER

A transfer plan approved by the Boards of Directors or Steering Committees. This plan must detail the

actions that will be taken to achieve transfer of the negotiated portfolio for mandatory insurance with

an indication of the estimated execution dates. It should include at least the following actions:

a. A draft of the communication to the insureds to be sent by the insurance company that prevails or

the acquiring company about the change in control or the merger and about the insureds' right to have the stipulated contractual conditions respected, unless they expressly accept the modification. The

communication must take place within a maximum period of ten business days after the

communication of the Superintendency's authorization.

b. Subscription to the contract addendum that replaced the insurance company.

c. Physical movement of documents.

d. Preparation of accounting entries.

C. OPERATION TERMINATION PLAN

Plan detailing the actions to be carried out with an estimated date of execution. It must include at least

the following actions as applicable to the nature of the entity’s activities:

a. Actions related to current advertising, internet sites or other communications media.

b. A detailed explanation of the mechanisms to use to guarantee fulfillment of the obligations acquired

by the entity and the possible accidents occurred but not reported that may be claimed after the

mandatory insurance is no longer offered.

c. Report on provisions that should present the calculation for each of the provisions required to deal

with current accidents or accidents that occurred but that were not reported.

d. Accounting entries for closing mandatory insurance.