More than eight million out of a housing stock around 28 million homes have no building insurance, and another ten million are underinsured, according to research by Kelisto.es, a price comparison website.
Eight and a half million homes without insurance represent 30 per cent of the housing stock, a proportion that has been getting bigger in the crisis years as squeezed families cut back spending on non-essentials.
Between 2007 and 2013 the number of uninsured residential properties rose 13 per cent, from seven and a half million to eight and a half million homes, with the biggest jump taking place between 2007 and 2010, as the crisis bit deep into Spanish society.
After rising to a peak of nine million properties without building insurance in 2010, the number has ebbed since then, falling to 8.5 million at the end of last year, still significantly higher than the pre-crisis level.
In 2007 69 per cent of homes had building insurance, falling to 64 per cent in 2010, then partially recovering to 67 per cent in 2013 (16.9 million homes).
Despite the increase in policies signed in recent years, the percentage of insured homes has not increased as 1.4 new homes have joined the housing stock in the same period.
Ten million homes underinsured
An additional ten million properties are under-insured say Kelisto, meaning insurance policies would not fully cover damage to property and contents.
“In recent years households have had to cut back on costs in response to falling incomes, and home insurance has been one of the products most affected by the cuts,” explains Celia Durán, head of insurance content at Kelisto. “As it is not an obligatory insurance, many clients have reduced their cover, or done without it all together.”
Cutting back on Spanish home insurance spending can turn be a false economy if things go wrong. Even small problems can be expensive to solve without insurance, say Kelisto. For example, repairing a leak can cost €300 or more, compared to an average insurnace premium of €206 per annum.
Higher premiums for the rest
Fewer clients have not been a big problem for insurance companies, who have simply increased the premiums they charge the remainder. Premiums have increased 18.5 per cent from 174 €/year in 2007 to 206 €/m2 last year. Insurance companies raked in 22 per cent more on home insurance in 2013 than 2007.
The Canaries have the biggest proportion of uninsured properties (56 per cent), whilst at the other end of the scale just 14 per cent of homes in Madrid are uninsured. Andalusia is the region with the greatest number of uninsured homes (1.8 million).