Most people think of insurance (and Insurance sales people) in the category of “don’t bother me with that nonsense, never had to use, and it’s a waste of money!”.
Well, it’s a topic the needs consideration in Guatemala, for several reasons.
I will try to explain the need for insurance, and once you have read the article, you can decide if it’s a good thing for you, or not!
Auto Insurance;
If you’re an Xpat, then insurance is something that you have grown up with, and in Canada, the US and Europe, we all know that auto insurance is mandatory. Without it, you have broken the law, which means a big fine could result, or if you have an accident, the system can put you in the poor house for many years.
In Guatemala, as in Mexico and other Central American countries (with the exception of Belize and Panama) insurance is not mandatory.
Speaking specifically about Guatemala, there are several things to consider. The first thing is what type on insurance works best for you. There are 2 options available.
The options are: 3rd party liability insurance, which simply means that if you are involved in an accident, the party that you may hit or cause damage to is covered by your insurance. Any damage that may occur to your vehicle is not covered. The standard 3rd party policy includes medical coverage for you and your passengers up to a predetermined amount that you select, and also legal counsel if required, up to a set amount as well. This type of insurance is available for anyone, (see note below, under Full Coverage for vehicle age restriction) which means that as a tourist, you can have coverage in the country when visiting. If you are travelling to Guatemala by car, insurance can be arranged prior to your arrival at the border. There are no agencies at the border, so you need to call ahead at least a week prior to your anticipated arrival. This does not apply to full coverage.
The second option is full coverage.
In this case, the words full coverage explains it. You and the other party in an accident are covered. This includes fire, theft, collision, glass breakage, road service, medical and ambulance, tow truck service and so on.
The restrictions are that the vehicle must be registered in Guatemala, be no older than 1991 at the time of this newsletter (the same applies to 3rd party liability as well) and a physical inspection of the vehicle must be done prior to the policy being issued. This is done generally at the insurance company’s main office in Guatemala City.
The policy is priced according to the declared value of the vehicle. In my case for example, I have a 2006, valued at approx. $10,000.00. The annual premium is under Q6000.00 ($750.00) annually.
For 3rd party insurance, there is a flat rate that applies to any vehicle regardless of the value, and it is approx. Q1600.00 ($200.00) annually.
Now, the question is what happens if I don’t have insurance.
The answer is not exciting.
If you are in an accident that can’t be settled on the spot with a few dollars, the police become involved, and depending on the severity of the accident, you can be arrested, your car will be impounded, you will most likely have to pay off several people, and eventually go in front of a judge, who will decide your fate. This may be from a few days, to several weeks, and if you’re a foreigner, the chance of getting a favorable decision is next to impossible. It’s amazing how many “witnesses” for the other party will come forward to be sure that you are the one at fault. In one case, the witness’s cell phone proved he was more than a 100 miles away at the time of the accident, but the foreigner was found at fault.
The other possible result is that when you retrieve you vehicle from the impound lot, it is quite likely that there will be little left to claim.
Home Insurance
Many people don’t realize that home insurance is readily available, and inexpensive in Guatemala.
We live in a country that presents several potential risks, such as earthquakes, tremblors (a lot of ground shaking that can cause damage to walls, roof structures etc), floods, hurricanes, and other annoying Mother Nature caused problems.
With those potential risks, who would want to issue an insurance policy, and if someone did it has to cost a fortune.
The truth is that full home owner coverage is easy to obtain, and not a costly item to protect your home, and contents as well.
One thing that purchasers of home insurance need to consider is the coverage should be related to the value of the home on a replacement value. You don’t need to insure the land the home sits on.
The average cost of construction for a home of decent quality home is around $550.00 a Sq, Meter (10.76 Sq. Ft.), luxurious homes can reach $800.00 per Sq. Meter.
For an average house of 250 meters, you should be looking at approx $525.00 a year for full coverage.
One question that people have is “what would happen if there was a disaster? Could the insuring company pay the claims?”
All insurance policies are underwritten by several major reinsurance companies around the world, so the actual risk the local insurance company commits to is only a very small percentage of the actual dollar value of the policy. So, yes, they are capable of paying all claims.
Health Insurance
There are 3 types of health insurance available in Guatemala.
The first one is IGSS, which is operated by the Government. For ease of explanation, here is a link that will give you the details. http://www.igssgt.org/index2.html. Foreigners can join the plan if they desire.
When you are dealing with IGSS, you need to remember that it is a national health care service, so the vast majority of the citizens will use it. That means hospitals are overloaded, care in minimal, supplies are limited, and Doctors are trained, but overworked. My comment is “don’t have a heart attack, or major surgery”.
The second type is sold by major local hospitals, and some private insurance plans. These plans offer various levels of coverage, from simple to complex treatment. The local private hospitals are clean, efficient, well equipped, and in many cases the Doctors have had US training. The nursing staff is generally very good and gives excellent pre and post operative care.
Prices are based on age of the person enrolling in the plan, and previous medical history.
By most standards, it is not expensive. These plans only cover you in Guatemala.
The third type is World Wide coverage. These plans are unquestionably the best choice for people who travel outside of the country, but they also cover you locally. You can find a hospital in just about any place in the world that will honor the plan. There is a deductible involved, ranging from $500.00 to $20,000.00, with coverage from $1 million annually up to $5 million worldwide. These plans are linked to specialty hospitals for such things as cancer, heart, back injuries, kidney, liver ailments, and under the policy, you can go to any of them for treatment. Generally treatment is done in the US. When you compare the premiums to US health insurance plans, you will be shocked at the difference in price.
Your medicare, medicade from the US does not cover you in Guatemala, and other insurance plans, in most cases do not cover you here as well. Travelers insurance is available, but the premiums are not realistic for long term coverage.
The general conditions of World Wide coverage is you spend at least 6 months a year out of your country of residence, due to the low premium rates.
For detailed information, use this link as an example. https://www.bmicos.com/bmicosSSL/sites/public/english/products/productos.htm
Life insurance
Life insurance is available both locally in dollars or Quetzales, and internationally in dollars.
Local life insurance can be purchased from most banks, and locally based insurance companies.
You can have whole life, term life, convertible term, and several other options. The premiums are reasonable in most cases. Internationally based insurance companies (US) are also very competitive, and their ratings give you more security that the claims will be paid. Always make a fair comparison before deciding with option is best for you.
Century 21 Casa Nova has been representing local and International insurance companies for over 15 years, with over 200 policy holders in Antigua. We offer all of the products mentioned in the Newsletter, and you can receive a free quotation for any of your needs by calling our office, or requesting a quote by Email.
If we can help, don’t hesitate to ask, and there is NO obligation.
Contact Brian Wilson at 7832-8729/30/31 locally, or US and Canada toll free at 866-428-0675
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