Home and car insurance in Spain: how it works and what is compulsory

Car insurance: the compulsory minimum under the law

Spain has a direct equivalent of compulsory motor cover: third-party liability insurance for the vehicle owner, seguro de responsabilidad civil. It is required by the law on civil liability and insurance in motor vehicle traffic (Real Decreto Legislativo 8/2004, Ley sobre responsabilidad civil y seguro en la circulacion de vehiculos a motor). The policy covers the harm you might cause to third parties: people, other people's cars and property.

A key detail many people miss: the insurance is tied to registration, not to whether you drive. As long as the car is on the DGT register the policy must be in force, even if the vehicle has not moved for months. Every policy feeds into the FIVA database (Fichero Informativo de Vehiculos Asegurados), and the administration cross-checks it against the vehicle register automatically, with no roadside stop needed.

• The fine for having no insurance is 601 to 3005 euro depending on the type of vehicle and the circumstances.
• The car can be immobilised and taken to the pound.
• If an uninsured driver causes an accident, they cover the entire damage out of their own pocket.

The legal way to stop paying for insurance on a car you do not use is to file a temporary deregistration with the DGT (baja temporal).

Terceros or todo riesgo: the levels of cover

Only the basic level is compulsory; beyond that it is a matter of arithmetic. The market has settled on three standard tiers:

Practically every policy includes free roadside assistance (asistencia en carretera) and legal protection. The price depends on your driving history, your claims record (the bonus-malus system), the driver's age, the region and where you park. Benchmark for 2026: basic terceros often costs from 200-300 euro a year, while todo riesgo is noticeably more.

Home insurance: when a policy is compulsory

For an owner without a loan, home insurance is voluntary: the law does not force you to insure a flat you own outright. The obligation arrives with the mortgage. The mortgage market rules (Real Decreto 716/2009) and the mortgage credit law Ley 5/2019 require the mortgaged property to be insured against damage, at a minimum against fire, for a sum tied to the appraised value of the building excluding the land.

Three things a borrower should know:

• The bank may require you to hold a policy, but it may not impose its own insurer: under Ley 5/2019 it must accept an alternative policy with equivalent terms, with no fee for reviewing it and no worsening of the loan conditions.
• Bank policies sold "as part of the package" are often dearer than market ones for the same cover, so comparing before you sign saves money every year.
• The shared structure of an apartment block is usually insured by the comunidad de propietarios, so check what is already covered to avoid paying twice.

If you are still choosing a property and a mortgage, see our walkthrough of buying property in Spain as a foreigner.

Continente and contenido: what exactly you are insuring

A Spanish home policy (seguro de hogar) breaks down into two levels, and confusing them is the main source of disappointment at claim time.

• Continente is the "shell": walls, floors, ceilings, windows, the fitted kitchen, plumbing and building services. Continente is exactly what the bank requires with a mortgage.
• Contenido is everything inside that is not fixed in place: furniture, appliances, clothing, valuables. Expensive items (jewellery, art) usually have separate limits that must be declared.

The third important block is civil liability (responsabilidad civil): a leak into the flat below, a flowerpot falling off the balcony, damage caused by your dog.

Who insures what in a rental

The logic is simple: the owner is responsible for the shell, the tenant for their own belongings and their own liability. A tenant only needs an inexpensive contenido + RC policy, while an owner who lets the property needs continente plus owner's liability.

Consorcio: who pays after a flood or a hurricane

A distinctive feature of the Spanish system is the state-run Consorcio de Compensacion de Seguros. It is a public body that covers extraordinary risks: floods, atypical storms, earthquakes and damage from terrorist attacks. After the destructive floods of recent years (including the DANA in Valencia) it was the Consorcio that paid compensation to those affected.

Here is how it works:

1. The price of every policy (home, motor, business) already includes a small compulsory levy that funds the Consorcio.
2. If the damage was caused by an extraordinary event on the official list, the claim goes directly to the Consorcio rather than to your insurer.
3. The payout is calculated according to the terms of your policy.

An important consequence: without a policy in force the Consorcio pays nothing. An uninsured home in a flood-risk area is a bet on luck, not a saving.

How to choose a policy without overpaying

A few rules that save money and nerves:

• Compare cover, not price. A cheap policy with an understated continente sum insured leads to a partial payout when the damage is serious (the proportionality rule).
• Check the excess (franquicia) and the exclusions: damage caused by pets, removable appliances and items on the terrace are often excluded by default.
• Do not overstate or understate the sums. An inflated sum means an unnecessary premium; an understated one means a partial payout.
• Review your policies every year. Spanish insurers renew contracts automatically, and notice of non-renewal usually has to be sent a month before the term ends.

Benchmark for 2026: a home policy for a standard flat most often costs 150 to 400 euro a year depending on the floor area, the sums insured and the region.

How Krepko helps

The Spanish insurance market means dozens of companies, contracts in Spanish and terms that only start to matter at the moment of a loss. Krepko does that work for you:

• We select and compare motor and home policies, translating the key terms and going through the exclusions.
• We review the bank policies attached to mortgages and, where it pays off, replace them with equivalent cover under Ley 5/2019.
• We handle claims: the notification, dealing with the insurer and the Consorcio, and keeping track of payout deadlines.
• The legally significant steps are performed by licensed specialists - lawyers, gestores and sworn translators.

More on our Insurance in Spain service page. Would you like us to price up your case? Leave a request - the review is free and we will compare the offers and show you where you are overpaying.

Sources

• BOE: Real Decreto Legislativo 8/2004 - Ley sobre responsabilidad civil y seguro en la circulacion de vehiculos a motor
• BOE: Ley 5/2019 reguladora de los contratos de credito inmobiliario
• Consorcio de Compensacion de Seguros
• Dirección General de Trafico (DGT)