The suspension of the 2001 insurance law continues to hamper development of local market

The market is already deregulated to a considerable extent, although the insurance law of 2001 had been intended to strengthen the hand of the superintendency regarding the regulation of participants in the insurance sector

The Venezuelan insurance market had been expected to contract following the introduction of much higher capital requirements in the 2001 insurance law, but by the end of 2004 there were still 49 companies active in the market. Market commentators suggest that 25 companies would be an appropriate number for the market. The suspension of the 2001 insurance law on constitutional grounds is regarded as a significant setback. Required capital levels were increased from those set out in the 1994 law in early 2005 but the new levels are less than those envisaged by the 2001 law.