We are sometimes asked by clients if they can pay their home insurance in Spain in instalments. Often this is because their home insurance in their native country is paid that way. Most home insurance premiums in Spain are not so large that it is necessary. However, the option does exist.
Many countries allow you to pay your insurance in instalments and Spain is no different. There are some benefits and some drawbacks if you decide to pay in instalments.
- Advantages of paying your home insurance in Spain in instalments
- Disadvantages of paying in instalments
- Get a home insurance quote
Advantages of paying your home insurance in Spain in instalments.
The main benefit is cash flow. If you have recently purchased your property in Spain then you have made a significant financial outlay. No doubt there were one or two additional costs that you had not thought about. Paying your home insurance in Spain in instalments may just ease things.
Something you need to be aware of when contracting your home insurance in Spain is the contract is for a 12-month period. This means that even if the insurance company agrees to you paying in instalments you are legally contracted to pay all the instalments that make up the annual premium. You cannot pay just some of the instalments and then decide to cancel or switch insurance provider.
Of course, you can change insurance company for the following year. Nearly all insurance policies in Spain automatically renew. So you must make sure that if you want to change insurance company you cancel your existing contract correctly. To find out more on this then visit our article about how to cancel your insurance policy correctly.
You do not have to hold a Spanish bank account. Many Spanish banks charge regular commissions on their accounts. If you pay your insurance premium in one annual sum you can pay by debit or credit card from a foreign bank.
Disadvantages of your home insurance in Spain in instalments.
One of the disadvantages of splitting the annual premium is cost. Insurance companies will increase the overall annual premium for the same cover if you pay in instalments. Check how much extra your annual premium will be if you split the payments. If the difference is not too large then the additional cost may be worth it. The more instalments you want to make the higher the overall annual premium the insurance company will charge.
Another disadvantage of paying in instalments is that you might lose track of when the actual annual renewal date is. If this happens then you might find the policy automatically renewing before you know it.
You must have a bank account to pay in instalments. In many cases, the bank must have a Spanish IBAN number to comply with the needs of the insurance company’s computer system. In case you are not aware, a Spanish IBAN includes your account number and the international banking code for your bank and branch. It starts ES….. A few insurance companies accept international IBANs. You will need to provide the full IBAN and BIC/Swift code.
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