Puerto Rico is the only U.S. jurisdiction that offers international financial and banking entities (IFEs and IBEs) the legal, regulatory, and intellectual property protections of the United States. With an IFE license, an entity can enjoy the following tax benefits:
Puerto Rico supports finance and insurance businesses with sophisticated banking tools, mobile financial applications, blockchain, and payment processing technology, ingredients that are key for them to scale operations and expand into neighboring markets.
The Puerto Rico Tax Incentives Code (Act 60) offers competitive benefits for a variety of activities in the finance and insurance industries. Incentives are granted for a 15-year term and can be renewed for an additional 15-year term.
Qualifying entities include small and medium businesses, and public-private partnerships.
In 2020, there were 823 licensed financial institutions with $164 billion in total assets. The two largest sectors of the industry are made up of 6 commercial banks and 27 IBEs. Commercial banks managed $75 billion in assets in 2020, up $10.3 billion from 2019. IBEs managed $59.3 billion in assets in 2020, up $2.6 billion from 2019.
The island maximizes local legislation to enable global financial and insurance activities. Therefore, companies benefit from unique flexibility and federal regulatory protection.
Under this combined jurisdiction, IFEs can:
The insurance market features 47 domestic insurers, 33 international insurers, 271 foreign insurers, and 481 protected cells. These entities offer:
|As an international insurance hub, actors in this sector enjoy the advantages of U.S. accreditation and protection, as well as attractive local tax incentives.
Puerto Rico’s insurance industry is amongst the strongest in Latin America on a per capita basis, thanks to the uniqueness of the regulatory landscape. The island has the highest degree of insurance penetration and density, as well as a high number of firms that keep prices and products competitive, with an insurance protection gap of just 0.2%.
Professional networks, industry associations, and governmental offices support this well-established sector.
Comision de Desarrollo Cooperativo (CDCOOP)