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The Venezuelan government's recent intervention of local insurer Banvalor Seguros was deemed "unfair and having a political background" by the owner of the company, Leopold Castillo Bozo, in an interview with local daily El Mundo.
On September 23, insurance regulator Sudeseg seized control of the operations of Banvalor Seguros, citing the company's failure to meet underwriting reserve requirements.
"We are witnessing an unfair matter, because [the government] intervened in a company that is solid, with more equity than debt; a healthy, solvent company," Castillo Bozo was quoted as saying.
Castillo Bozo said that Sudeseg cited a 20-million bolivar (US$4.65mn) underwriting deficit, but in reality the company had more than 350mn bolivares in assets to back up its operations and cover any potential losses.
As of the end of July, Banvalor Seguros ranked 13th in the country, with written premiums of 435mn bolivares and a 2.29% share of the insurance market. However, as recently as 2007 Banvalor was vying for the first place position in the market.
Venezuelan regulators took over more than a dozen banks and financial institutions during the closing months of 2009 and into the beginning of this year, citing financial malfeasance and putting some bank managers and owners in jail.