Latin American insurers have been warned the continued political crisis in Venezuela is likely to result in significant insurance claims amid fears of civil disturbance and violence.

Following the capture by US forces of the country’s president Nicolas Maduro, US president Donald Trump has said that the US will effectively run the country and will look to invest in Venezuela’s oil industry but it will come at a cost.

Posting in the Trust social media platform Trump revealed: “I am pleased to announce that the Interim Authorities in Venezuela will be turning over between 30 and 50 MILLION Barrels of High Quality, Sanctioned Oil, to the United States of America.

“This Oil will be sold at its Market Price, and that money will be controlled by me, as President of the United States of America, to ensure it is used to benefit the people of Venezuela and the United States!”

While Delcy Rodríguez has been sworn in as interim president opposition leader Corina Machado has said she is ready to lead the country.

Speaking to American media Machado, who recently win the Nobel Peace prize said her opposition  coalition should “absolutely” be in charge of the country.”

“We are ready and willing to serve our people as we have been mandated,” Machado added.

While the country is on the USA’s sanctions list major insurance market have been barred from offering cover, however reginal insurer face claims is the civil disturbance and political risks spread.

Josh Hatfield, chief product officer, Synthetik Insurance Technologies explained it is likely that despite USassurances that they will support any new administration in Venezuela, the country remains in a highly volatile state and there is likely to be civil disturbance and political uncertainty in the short to medium term as rival factions clash.

“The US seizure of Nicolás Maduro and the resulting uncertainty around Venezuela’s future governance and the role of the United States raise the possibility of civil unrest, with potentially significant implications for property damage and insurers in the region,” he added. “Venezuela has a long history of politically motivated demonstrations that have often involved violent clashes with authorities. Historically, direct action in Venezuela has ranged from demonstrations concentrated around political landmarks to student-led protests and broader, large-scale protests or riots.

“Locations such as Miraflores Palace, the physical seat of presidential power, and the nearby Plaza Bolívar have been focal points for past demonstrations and remain plausible flashpoints given the current political situation. We estimate that hundreds of millions of dollars of first-floor property exposure lie in the immediate vicinity of these landmarks, underscoring the potential severity of losses should unrest occur there. Similarly, the Central University of Venezuela has frequently served as a centre of student-led protests.”

Hatfield continued: “Recent major unrest in the country, particularly under President Maduro, has tended to manifest as large-scale and more geographically dispersed marches and demonstrations. However, there is also a precedent for politically driven, widespread looting, most notably during the Caracazo riots of 1989.

“These different patterns of civil unrest warrant consideration of multiple corresponding risk scenarios. We have developed a range of risk maps by identifying likely target locations for strikes, riots, and civil commotion and by constructing realistic event footprints. They illustrate relative risk maps across Caracas for unrest focused on political landmarks, student-led protests, and acquisitive looting activity.”