Buying Spanish Home Insurance  

by Pool Builders on 06-05-2011 in Articles

When buying any property there is a lot to think about: selecting a conveyancing lawyer, arranging a mortgage and many other problems to find solutions for. What is often not given the attention it deserves is the arrangement of home insurance. Michael Liggan of Altavista Property Spain in Marbella cautions new buyers to not overlook this vital element of a Spanish property purchase.

"It is vital to get independent professional advice" said Michael. He went on to point out some of the complexities involved in choosing an insurer for a Spanish property. The first is to decide whether to use a British or Spanish company. Spanish policies generally have lower premiums than those of a British insurer, but they don't provide the same level of cover either. In Britain a buildings policy will usually cover the home itself, any outbuildings, a swimming pool, walls, gates and fences. They will also cover permanent fixtures in the home such as a fitted kitchen. Additional accidental damage cover is also often available. Spanish policies will usually not cover a pool, outbuildings or boundary features such as fences or walls. Whilst arranging a Spanish policy may save €50 or more in premiums, choosing it may be expensive in the long run if a claim has to be made. Michael said that this is just one of the factors to take into consideration.

He also pointed out that the policies covering community blocks usually do not cover an owner's own unit, but are limited to communal areas such as walkways and swimming pools. It is important to also ensure that the contents of the home are insured. These polices generally cover the things that you would take with you if you moved home. It is best to arrange a policy that provides "New for Old." This avoids lengthy claims processes when the value of the broken or lost item has to be negotiated. This is also the basis on which you should value your contents. There is a general principle in insurance that should a policy holder undervalue the insured asset, the payout in any possible claim will be discounted by a similar proportion.

It is important to ensure that the policy covers public liability, especially if the new purchase is to be let out for holidays on a commercial basis. Even if letting the home to friends, this cover can still be important to cover such events as the casual tenant having an accident and bringing a law suit against the owner for negligence.

If the property is to be let on a commercial basis, it is extremely important that this is specifically allowed for in the policy. Many Spanish policies only allow for occupation by family and friends.

One further thing to bear in mind is that in the event of a claim on a holiday home, the distance and language barrier can be tremendous problems when seeking a speedy and satisfying result. This is another instance where arranging insurance through an independent adviser who is experienced in Spain is highly desirable.

Mr Liggan said that Altavista Spain have what they call AV Trips. These are trips to the Marbella area designed to give potential clients a clear view of properties that they may be interested in buying. In the event of a client wishing to buy, Altavista will provide a list of independent insurance intermediaries who are experienced in the Spanish market and in helping British buyers. He said that this is part of the holistic service that they offer to their clients to ensure that a purchase progresses in a smooth and easy way.

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