Venezuelan lawmakers have voted to formalize the expropriation of insurance company Seguros La Previsora, which was closed down last December because of irregular activities.

President Hugo Chavez requested the National Assembly approve the expropriation in order to turn La Previsora into a state company that will better serve Venezuela’s poor majority.

Earlier this year another newly created state insurance company, Bolivariana de Seguros, acquired much of La Previsora’s portfolio. La Previsora was the country’s fourth-largest private insurer, taking 7.9% of total market premiums in 2009 before it was closed. It was taken over by the government together with eight small banks, some of which were reported to have had solvency or capital problems.