Insurance information for expats living in spain

Information

How to calculate home insurance in Spain

 

Our Property is usually the biggest investment we make in our lives and not only could we lose it, for example, in the event of a fire we could also lose everything in it. Our memories, photos, important legal documents.

If you are reading this then you probably already realise that it makes sense to organise home insurance in Spain.

Whilst we cannot replace the memories or photos you can make sure that you are suitably protected so your property is rebuilt and the costs involved in reproducing your important legal documents are covered.

The main protections of home insurance in Spain are usually Split into building insurance and contents insurance.

 

Buildings cover:

To calculate your buildings cover you need to calculate the rebuild cost and not the resale value.

The rebuild value may be less than the market value. This is because you do not need to buy the land again, if your property is destroyed. You already own it. The market value of the property is affected by a number of factors that do not alter the rebuild cost. For example, the area may be very desirable. Perhaps it has good schools nearby, some wonderful views or maybe good connections to other towns and cities. These factors affect the market value but they don’t change the rebuild costs.

The rebuild costs should also make sure your home insurance in Spain includes an amount for clearing away debris, planning permissions, architect and surveyors fees and IVA (VAT plus other connected costs.

The insurance companies themselves will calculate an estimated cost per square metre based on the post code but this is very general. You need to bear in mind the quality of the build. If the materials used were of higher quality than normal then this needs to be factored in.

Do not be tempted to undervalue your property when taking out the insurance. If, for example, the insurance company has suggested a figure for rebuild, do not go below that indication. There are two reasons you should not do this:

 

  • If you under insure and you have to make a claim then the amount of the payout will be insufficient to rebuild the house.
  • You leave yourself open to a claim of under insurance. When you take out a policy the insurer expects the premium paid to reflect the risk they are taking. If the property is valued at 300,000 but you are paying a premium for a policy worth 150,000 then you are underinsured. You will have paid the insurer a lower premium than the actual risk is worth. This would enable the insurer to reduce the payout to you. So not only would your payout not be sufficient to rebuild your property it could be further reduced because you have not paid the correct premium for the risk.

In the rare case that you feel the insurance company’s rebuild value is too high then we do not recommend you lower it but choose another company instead.

How to calculate your contents insurance in Spain

The best way to calculate the amount you need for your contents cover in your Spanish home insurance policy is to go from room to room adding up everything. Go into one room and take a look at what is in there. Curtains, curtain rail, wardrobes, clothes, chest of drawers, beds, matresses, shelving etcetera. Add it up and write down the figure. Then move to the next room and do the same.

It is particularly important to remember that your kitchen forms part of the contents of your property and not part of the buildings insurance.

When it comes to collectable items, antiques and jewellery it might be necessary to have the ítems valued. This will depend on the individual insurance company. An insurance company  may want an individual list of all items of jewellery, watches or collectables with an individual value of more than 3,000 euros. These should be itemised in the policy. You may also be asked to provide a valuation i fan individual ítem excedes a certain amount. In the case of jewellery this usually means getting it valued by a reputable local jewellers.

Again do not under insure as in the event of everything being destroyed then you will not receive sufficient to replace your loses.

In summary

Insurance is not an emotional purchase. It doesn’t make us feel good to buy it but it does give peace of mind. However, it only does that if you take out the appropriate level of cover and pay the relevant premium.

Please think about the cover you require to avoid disappointment at what will probably be a very difficult time.

 

Ventajas de contratar un seguro

Three reasons to buy life insurance

A proven product that everyone should protect themselves with.Life insurance is a necessary purchase that has the benefit of giving you and your family peace of mind.

There are many different types of cover that can be tailored to suit your needs and lifestyle. Life insurance not only provides financial protection in the event of death but it is also a savings product that offers benefits that are becoming ever more extensive and customisable, so it is not surprising that, after car and home insurance, it is the third most contracted insurance cover in Spain. The average profile of a person who contracts life insurance is a married male aged between 35 and 44 years old, but it is never too late or early to take out a policy.

1. Arrange a mortgage to buy a house In Spain, six out of ten homes are bought with a mortgage.

In this case, it is advisable to take out life insurance because, in case of death or permanent disability of the person who contracted the mortgage, the insurer will take over the payments to the bank and remove your partner or relatives from the economic responsibility that could be difficult to continue with. In fact, with most banks it is a pre-requisite as a guarantee before signing the mortgage. Until recently, banking entities conditioned their mortgage lending with an “obligation” to contract some linked products, such as Life insurance. But since a few years ago, with the approval of the European Parliament of the Mortgage Credit Directive, banks are prohibited by law from linking a mortgage to the purchase of insurance. You only need that your insurance company includes a clause in your policy registering your lending bank as the mortgage beneficiary. In that way, you comply with the request of the bank but you also save money. You could even save a difference of 700 euros as the products offered by the bank can be up to 300% more expensive.

2. Start a family Life insurance can also be a guarantee for those who are thinking about starting a family.

It should be taken into account that raising a child in Spain can be expensive. It has been estimated that a baby can cost 14,266 euros during its first year of life and 14,056 euros during the next two. On average, a child can represent the disbursement of 1,183 euros per month during its first three years, which represents 80.78% of the average monthly net salary of a worker. It will depend on each person’s standard of living, but before the child turns 18 the parents could have spent between 115,000 and 350,000 euros. If at any time one of the parents dies, it will be difficult for the family to maintain the same rhythm of life. In those cases, although the personal loss will be irreplaceable, life insurance could guarantee the necessary capital to meet family expenses. With Liberty Seguros, even if the insured dies in an accident along with his/her spouse and they have children younger than 18, the beneficiaries will receive double the sum insured.

3. Protect your income level Last year there were 3,796 serious occupational accidents in Spain. Of these, 618 had fatal consequences.

The possibility of suffering an accident at work or outside that causes a permanent or temporary disability exists, so it is a wise choice to protect your income level. It will depend on each policy, but the insured can receive an advance payment of the contracted capital in case of temporary or permanent incapacity that prevents them from working and, therefore, affects their income, whether as a result of an accident or illness. In fact, with Liberty Seguros, the insured will be advanced the sum insured for death if he/she is diagnosed with one of the following serious illness or needs one of the following operations: cancer, heart attack, cardiovascular accident, kidney failure, bypass surgery, paralysis and transplant of vital organs, in accordance with the terms established in the special conditions of the policy.

 

Sources: (2018, May) Profile of life insurer buyer in 2017. In: ICEA. (2018, February) Almost 42% of retirement pensions in Spain are lower than the SMI. In: El Economista. (2018, February) Occupational Accident Statistics 2017 in Spain. In: GTG. Paola, M. (2017) How much does it cost to have a child? In: La Vanguardia. (2013) A burial costs an average of 3,545 euros. In: OCU.

https://www.libertyexpatriates.es/opencms/opencms/noticias/Three-reasons-to-buy-life-insurance.html

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When the community has a policy. Do I need home insurance in Spain?

A community policy in Spain is designed to protect the property of the community.

That is the overall building structure and communal areas. However, it does not usually cover your own windows and doors, nor your contents such as clothes and electronic goods, or the kitchen, as examples.

Therefore, your contents will not be covered by a community policy.

Furthermore, if there is a leak from a pipe in your property, that subsequently damages the property below for example, then you are most likely liable to pay for any damage done to your property and your neighbours.

The community policy will cover communal pipes and pipes in communal areas, but it will not cover damage caused from broken pipes within your home. They are your responsibility.

As a result we would recommend that as a minimum you take out a first loss home insurance policy in Spain to protect you in such cases as well as contents cover.

funeral in spain

What happens if one of our family in Spain passes away?

We live in a wonderful country with fantatsic weather and an enviable lifestyle, which means we normally give little thought to what happens if one of our family in Spain passes away.

Would you know what to do? Who do you advise? What is the legal procedure? What if the recently deceased wanted to be returned to their native country for burial?

These are all questions we should give some thought to before something happens.

During a traumatic time, not knowing the answers to the above questions will only add to the distress and frustration at a time when it would be most unwelcome.

It is not just a case of writing a Spanish will. Although that is very important. You should make someone aware of what you would like to happen to you should you pass away.

Funerals are organised very quickly in Spain, typically 24 to 48 hours leaving little time to organise everything. If the deceased had wanted to be returned to their native country then organising transport to that country is going to be complicated and expensive, unless it has been planned for.

When someone dies a doctor is called to confirm the death and issue the death certificate. From then you are normally put in touch with local funeral directors. How much does a funeral cost? Do you know what this process involves? What is your grasp of the local language like? Will they understand and respect the wishes of the deceased? Do you know what you will be asked to sign?

If the answer is any of these questions is “I don’t know” then please read on.

You might want to consider putting in place arrangements that will avoid all of the potential problems of having to make quick decisions, in a foreign language at a highly emotional time by making arrangements now.

There are generally two ways you can organise profesional help now for these difficult times of life that face us all in the future.

It is possible to organise funeral arrangements now that fit with your family’s particular requirements. One way is to make a monthly payment to a company that will take care of these funeral arrangements and the costs for you if you pass-away.

The alternative is to decide make a one off payment to a Company that will take care of your funeral in due course, fixing the Price now.

The advantage of the monthly payment option is that you don’t pay for the full funeral cost up front. The payments are revised from time to time to take into account your age so they will increase as the years go by. You have the flexibility to change the company providing the service if you feel the premiums are too expensive or the cover is no longer appropriate.

The benefit of paying a one off amount is that you do not have to worry about an increase in premiums as you get older, or an increase of costs of a funeral.

With a 24 hour contact number, in a language you understand you can feel comfortable that at such a delicate time someone who does speak the local language will be there to help you through.

These types of policy include a variety of options including the following:

  • No medical
  • Up to 8 people on the same policy
  • Mortuary expenses
  • Funeral arranagements
  • Repatriation if included in the policy

If you would like to discuss either or both of these products further please contact us at our Mijas or Marbella office.

Are you self employed and think private medical insurance in Spain is too expensive?

Well, you might be pleasantly surprised!

 

One of our insurance partners, who specialise in providing private medical cover, is offering the self-employed and their immediate family a very competitive product.

 

Not only are the premiums very attractive but you may be entitled to off-set up to 500 euros of annual premium against your tax liabilities, making the product even more affordable

 

This is full private medical insurance. No co-payments when you visit the doctor or have a diagnostic test. You pay the monthly premium and that is it.

 

It also includes 20.000€ of emergency worldwide cover and no grace periods except in the case of pregnancy.

 

The normal underwriting conditions apply and there must be a minimum of three members in the scheme to qualify for this product.

 

Remember, with the possibility that up to 500 € of premiums can be used in your tax calculations the actual cost could be even less.

 

Below is a table to help you calculate the cost

 

 

Age

Monthly Premium per person

0 to 19 years 39.01 euros
20 to 49 years 47.73 euros
50 to 54 years 56.91 euros
55 to 59 years 68.39 euros
Older than 59 years 108.33 euros

 

 

This offer is only available until the 31st July and if you are interested in knowing more about this offer or would like to take out a policy don,t hesitate to contact me

 

Kind regards

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Types Car insurance in Spain and some additional extras

There are various types of car insurance in Spain available and the purpose of this article is to go through some of the differences.

Whilst we all want to pay a low price for our car insurance in Spain make sure it includes what you would expect. You only find out if your insurance is any good when you make a claim.

In Spain there is a legal requirement to insure your vehicle. Whilst a basic policy may allow you to circulate on the road it probably won’t offer you the cover most people would want from an insurance policy.

The policies available include:

  • third party only,
  • third party, fire and theft,
  • third party, fire, theft and total loss and
  • fully comprehensive with or without an excess.

In addition to these main products, it is possible to add an array of add-ons to tailor the insurance to the client’s needs.

Let’s start with the main policies for car insurance in Spain:

Third Party

This is the legal minimum required in Spain. With this type of cover you are insured if you damage another person’s vehicle, for example. In simple terms, if there is a claim and it is deemed your fault the insurance company will pay out. The other driver will have their vehicle repaired.  However, any damage to your vehicle will have to be paid by you.

This type of policy only covers third party damage. Whilst it is the cheapest type of policy it could leave you with a large repair bill.

A basic third party policy will also not cover your vehicle in the event of theft or damage by fire.

Third Party Fire and Theft

This level of car insurance in Spain provides the legal minimum of third party insurance. In addition, you have the added benefit that if the vehicle is destroyed by fire or stolen that you are covered.

Third party, fire, theft and total loss

One more step up and you can also include total loss cover. This is not fully comprehensive cover. The difference here is that the additional of total loss cover on top of the third party protections explained before. In the event of the insurer declaring the vehicle a write-off (not worth repairing) then they will pay out an agreed sum to the policy holder. However, if you damage the vehicle but it is not a total loss then you will have to pay to repair the damage.

Fully Comprehensive

If your car is new or fairly new, then you will probably want to consider fully comprehensive car insurance in Spain. Not only do these policies cover your obligations in respect of damage to others it also includes protection for your own damage. So even if an accident is deemed your fault you will have a level of protection for your vehicle.

If for example, you drove into the back of another car then it will almost certainly be deemed your mistake. As a result, your insurance company will liaise with the other person’s company to repair their vehicle. In addition, your insurance company will organise the repair of your vehicle.  All you have to do is pay the excess. This the amount you pay to repair your vehicle before the insurance company pays. If the damage to your car is less than this amount, then it will not be worth making a claim and you can pay for the repair. If, however, it the repair bill is higher than the excess then the insurance company will pay the difference.

The level of excess is agreed by you with the broker at the outset. For a new car it is possible to ask for an excess of zero. The insurance company would then pay all the cost of the damage, even if the accident was your fault. However, in order to reduce the price of car insurance in Spain most people opt for an excess of between 100 and 300 euros. Clearly the higher the amount of excess the lower the premium.

Accident and breakdown assistance, windscreen protection and courtesy cars.

These days a lot of insurance companies include these services as standard. However, not all insurance companies do. If they are included, we do not recommend removing them and if they are not we suggest you ask for them to be included.

It is illegal to tow a car in Spain. Therefore, if you do not have accident or breakdown recovery you will have to pay. The tow truck may drive you first to the cash machine before taking you to your destination or the garage to ensure payment.

If a stone hits your windscreen, then your visibility may be effected or the crack may gradually get worse. If it is included in your insurance you can usually make an appointment or possibly roll up to a specialist windscreen replacement centre, such as Carglass. They will repair or replace your windscreen and organise with the insurance company directly to receive payment.

We are all reliant on our vehicles to get to work, to take the children to school or to do the weekly big shop.  If it is going to be in the garage for a number of days whilst it is being repaired, then if you don’t have a courtesy car you will have to rent one.  In some tourist areas this can be difficult in the summer and also very expensive.

Remember if the accident was not your fault then you do not pay for the repairs to your vehicle.

 

Why is it so important to have a death insurance?

In times as hard as the loss of a loved one, we can save our family the whole process that involves a death, economically and emotionally speaking, are very delicate moments where your loved ones will have the peace of mind that everything will be in good hands .

 

For an amount less than you imagine, the insurance company would handle all the bureaucracy related to the funeral: funeral, burial or cremation, hearse, flowers, transportation and even repatriation to the country of origin if desired.

 

Do not leave your family in a delicate situation in case of death, for very little money give them the peace of mind they deserve.

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Life Cover, is that not expensive?

One thing is definite but it is something we do not like to think about or discuss with our loved ones and that is our inevitable passing away. It is difficult, who wants to bring this sort of matter up at the dinner table?

Whilst it is very difficult think about the following:

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Why do the prices vary between one car insurance company and another?

The price is an important element at the point of agreeing your car insurance.

You should bear in mind what makes the principal difference is the cover.

But also, between companies the operate by telephone or internet there exists other differences.

Usually they are cheaper and don’t have offices because the business structure.

They have distinct forms of calculating insurance risk and accident claims and normally these companies.

Use good marketing and have attractive sounding names for their insurance cover.

However, it is important to read the small print of these policies.

We recommend that you read well the cover and conditions before you contract your car insurance.

How many days are you covered for hospitalization in your private health insurance?

Prolonged hospitalization constitutes a grave concern worldwide because it generates negative effects on the health system such as, for example: increase in costs, deficient accessibility to hospitalization services, overload of emergency services, and the risk of adverse effects

The causal agents of extended hospitalizations found with higher frequency are: delay in the performance of surgical and diagnostic procedures; need for attention in another complexity level; social-family situation, and the age of the patient.

 

When you take a private health insurance don’t look just the price. Although all the insurance companies could be the same, the covers are very different between them like the days of hospitalization which is one of the most important covers. Sometimes a patient has paid the hospital room having covered the contracted days in his insurance policy.