Earthquakes in Colombia and Venezuela expose insurance gaps

Earthquakes in Colombia and Venezuela in 2026 have exposed the wide insurance coverage gap for small businesses and households in Latin America, according to Bloomberg Línea. The insurance brokerage Marsh, cited by the outlet, warned that the lack of protection against climate and seismic events shifts the economic impact directly onto families, bank balance sheets and public finances across the region.

The mechanism of low insurance penetration severely affects the cash flow and working capital of the businesses hit. In economies such as Venezuela's, infrastructure losses erode the value of loan collateral and raise the risk of defaults in the financial system. Even in markets with more developed institutions, such as Colombia's, current coverage is insufficient to cushion disasters of great magnitude.

According to data from the Swiss Re Institute reported by Bloomberg Línea, damage to buildings and infrastructure from the seismic sequence in Venezuela totaled $20 billion. Globally, insured losses from natural catastrophes reached $42 billion in the first half of 2026. Over that period, insurance covered 42% of total economic damage worldwide, above the historical average of 33%.

The lack of protection for assets in the affected areas compounds the productive paralysis. According to El Nacional, spokespeople for Fedecámaras in La Guaira said that 50% of local commerce remained paralyzed because of the tremors, with total losses of 56%, which slows the recovery capacity of the commercial sector.