All Spanish insurers contribute to the Consorcio which is a government fund that covers natural disasters such as earthquakes and floodings.
What happens if the flooding is not a natural disaster you may be asking. Until recently there had to be a certain level of water or wind to be considered a normal claim. However, the majority of companies now do not take this into account which is a good thing.
If there are damages caused by water or wind companies now look to compensate the client and not put out the line “that the water or wind level does not reach the requirement”.
Concerning subsidence, this does not always have to be caused by an earthquake. In this situation, most insurers do not include this cover automatically. In order to have cover for subsidence, it will be necessary to include “all risk on the building”. Even having this included only a few companies will then cover any subsidence. Some companies may require a report to be carried out on the soil and foundation. Others might not, so it is important an insurance expert is spoken to when looking to cover subsidence.
Is subsidence cover important?
We think this is important during the first 10 years of construction of the property as the foundation is still getting used to the soil and bedding in. After 10 years usually, there will not be many issues caused by subsidence. Saying this it is definitely worth including All risk cover on the building as the cost is not very expensive. An approximate extra cost is 10 % of the total premium.
What else is included in “All risk cover to the building”?
“All risks” is a type of insurance coverage that covers anything that the standard insurance contract does not cover. Therefore if a driveway is damaged by a vehicle that was too heavy to be parked on the tiles an All risk policy for the building would compensate for the damage. A normal policy would not cover this type of damage.