Ecuador Insurance Information

CIA link to demographic/economic data on Ecuador

General Ecuador Insurance Information

• Compulsory Insurance:
  
  1. Work related injuries;
  2. Imports.
• Non-Admitted Insurance:
  Prohibited. Heavy fines for not observing the law. With authorization from the Superintendency, non-admitted insurance may be permitted for coverages and /or capacity purposes not available in the local market.
• Policy Wordings & Rates / Tariffs Controlled:
  Wordings are approved by the Banking and Insurance Superintendency. A fire tariff still legally exists but is largely ignored by all parties.
• Policy Language:
  Spanish.
• Types of Insurance Restricted to Government Institutions:
  Workers’ Compensation.
• Policy Currency:
  The Ecuadorian Sucre (S). U.S. $ insurance available but rarely used.
• Currency Restrictions / Exchange Controls:
  No restrictions. Foreign exchange can be done through banks or exchange houses (shop carefully).
• Policy Period:
  Annual though for larger risks multi-year policies are available as long as annual reviews are conducted and values and premiums so adjusted.
• Cancellation Provisions:
  By the Insured: Immediate. By the Insurer: 30 days written notice.
• Premium Tax, etc. paid by Insured:
  10% for all lines, plus a 3.5% fee to the Superintendency of Banking and Insurance.
• Insurance Companies:
  Must be registered with the Superintendency.
• Brokers:
  Brokers operate in the market but much business is transacted directly with Insurers. Retail Brokers and Reinsurance Brokers must be registered with the Superintendency.
• Brokerage Commissions:
  
• Broker of Record Letters:
  Required for commercial business.
• Reinsurance:
  This is an active market for reinsurance ceded business due to the size of risks in relation to the financial size and strength of local Insurers. A 1.8% tax applies.
• Local Natural Hazards:
  Earthquake, flood and volcanic eruption.
• Other Information:
  Approved non-admitted insurance premiums can be deducted as a business expense.

Property Insurance

• Fire:
  Standard fire perils include - fire and lightning. Explosion, riot / civil commotion, malicious damage, vehicle impact, earthquake, flood, landslide, aircraft, burst water pipe are available in the market for additional premium charge.
• All Risk:
  Available on a selective and limited basis by some Insurers.
• Coinsurance:
  100%, 90%, 80%.
• Blanket Insurance:
  Available - contents only
• Business Interruption:
  Local forms follow UK Loss of Profits and U.S. Gross Earnings forms.
• Replacement Cost:
  Available.
• Discount for fire protection equipment / systems: Available but credit is small which negatively impacts to the return on investment (ROI) calculations.

Boiler & Machinery / Machinery Breakdown / Engineering

• Wordings:
  Forms are similar to UK and U.S. contracts. Inspections are not required.

General / Public Liability

• Available Wordings:
  Forms follow U.S. style and include Product Liability.
• Comments:
  Policy can be written on an occurrence form.

Automobile / Motor

• Compulsory Limits:
  None known.
• Comments:
  Coverage applies to Insured and any individual driving with the Insured’s permission. Passengers are not considered Third Parties; however, coverage can be endorsed to the Automobile policy. Business fleet policies are available.

Workers’ Compensation

• Comments:
  All nationals are protected under the Government Social Security Scheme. Note: Agricultural workers may not be covered - this requires checking. Employees send abroad are not included. Medical Expenses and Occupational Disease benefits are included. Employees have the option to sue.

Marine

• Available Wordings:
  Local wordings. Insurance on imports is mandatory and must be insured by a locally licensed Insurer. War Risks rates follow London scale.

Crime

• Available Coverages:
  Name and position bonds available; burglary, money, and an assortment of bonds including performance and custom.