THIRD PARTY COVER – IS IT RIGHT FOR YOU?
When driving in Spain, the minimum cover you must obtain by law is Third Party (Terceros). Third Party insurance means that if you damage another vehicle (or person!) in an accident, then your insurance company will pay for the damage to the other vehicle but not for any damage to your own. Usually, this is the cheapest insurance available and many people, especially younger drivers select this option. It is possible to “add on” additional cover to third party such as glass (lunas) and fire & theft (incendio y robo) but any damage to your vehicle, caused by you would still not be covered.
The only way to cover your own damage caused by yourself is to select Fully Comprehensive insurance (todo riesgo). Obviously, if you make a claim then your
no claims bonus is affected and you normally have to pay an excess…. but that’s another article….
If you were unfortunate enough to be involved in an accident that was not your fault, and you only have third party cover, then you claim for any damages to your vehicle from the other driver’s insurance company.
There is a reciprocal agreement set up between the majority of insurance companies in Spain which generally speeds up the process. Basically, once the other insurance company has accepted liability, they give the go ahead for the repairs to be done to your vehicle. The two insurance companies then sort out the “money” side of things behind the scenes and you go back to driving your car.
However, if the other driver’s insurance company do not accept liability you would then have to wait until the dispute was resolved, sometimes via the Spanish courts, until your vehicle is repaired. You could, of course pay for the repairs yourself but you have no guarantee that you would be reimbursed or how long it would take!
If you were very unlucky and happen to have an accident with a vehicle that is insured by a company that dies not conform to the reciprocal agreement or is insured with a foreign insurance company, then you can expect to wait at least 5-6 months before the claim is settled and your vehicle repaired even if they accept liability!
This means your vehicle could be “off the road” awaiting repair for a very long time!
If you had selected Fully Comprehensive insurance, then your insurance company would pay for any repairs to your vehicle (less any excess). Your insurance company would then claim back any costs involved from the other insurers.
You may think that your vehicle is not worth much money and that it isn’t really worth paying the slightly extra premium for fully comprehensive insurance but consider what your car is worth to you as a means of transport?
Could you do the weekly shop without a car?
Do you need to drive the kids to school every morning?
Do you need to drive to work?
Can you really afford to be without your car for a long period of time?
Third party insurance may be the cheapest insurance available but is “cheap” always the best option?!! Or is it merely penny wise, pound foolish??
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