• TVT Seguros

Volcano eruption in La Palma: What do insurance policies cover?

Updated: Sep 22, 2021



The lava rivers have already swallowed a hundred houses in the municipalities of El Paso and Los Llanos. Many of us are wondering what happens with the material damages and all family belongings? Are they insured against the damage caused by the eruption? What does the insurance cover? Here we address the role of the Consorcio de Compensación de Seguros (Spanish Insurance Consortium) as the natural catastrophe management system in Spain and how claims handling is processed.


Erupción del Volcán en La Palma ¿Qué cubren las pólizas de seguro?
Volcano eruption in La Palma: What do insurance policies cover? Photos: Saul Santos / Eltime.es (19.09.2021)

While it is true that the general conditions of home / multi-risk insurance policies explicitly exclude the coverage of damages caused by natural catastrophes such as volcanic eruptions, losses are covered through the Insurance Compensation Consortium. We will explain what the Consortium consists of, the criteria for requesting compensation and the steps to follow in the event that you have been affected and need to open a file and request compensation.


Update!!! 1st Informative Note of the Consortium (21-09-2021) (click to access information)



Spanish Insurance Compensation Consortium - the Spanish catastrophe management system


In Spain, damages caused to property and persons (insured) by natural catastrophes (volcano eruption, earthquakes, floods, tsunamis, earthquakes...) are assumed by a public entity, the Consorcio de Compensación de Seguros (Spanish Insurance Compensation Consortium). This entity is financed entirely through a surcharge on the insurance premiums themselves (it does not receive resources from the public budget).


In order to be entitled to compensation due to the Volcano Eruption in La Palma, it is therefore necessary to have a policy in force and this must include coverage for any of the following risks: fire, theft, glass breakage, damage to machinery, electronic equipment, computers, or a combination of these risks. For example, the policies known as multi-risk home, community, office, commercial, workshop, industrial, SME policies, etc.


This crisis and catastrophe management system, in addition to having made it possible to meet the costs of enormously damaging catastrophes such as the "gota fria" in the Basque Country or the Lorca earthquake, has the virtue of equalising the risks. In the absence of the Consortium, for example, areas more prone to flooding would pay more expensive insurance; however, through this system the burden of costs is spread equally throughout the country.


Frequently Asked Questions:


I have suffered damage to my home as a result of the Volcano Eruption on La Palma, am I entitled to compensation?


Yes, if you have a policy (home, car, commercial) in force. Only those damages that affect persons or goods for which an insurance policy has been taken out with any authorised insurance company, and provided that the policy is in force at the time of the damage and the insured is up to date with the payment of the premium, are indemnifiable by the Consortium.


The Consortium is responsible for the compensation of the damage on the basis of the same policy contracted with the insurance company. This means that, at the time of indemnifying, the Consortium will take into account the same assets, the same insured capital and the rest of the conditions (first risk, indemnity limits, etc.) established in that insurance policy for such contingencies.





I have suffered damages to my automobile due to the Volcano Eruption in La Palma. What coverage must my policy include in order to be entitled to indemnity?


In the case of automobiles (cars, trucks, buses, commercial vehicles, motorcycles, mopeds...), the Insurance Compensation Consortium will compensate the damages both in the case that the vehicle was insured with some coverage for damages to the vehicle itself (for example, breakage of windows, theft or those known as comprehensive insurance with or without excess), and in the case that it was only insured by a civil liability policy (policies usually known as "compulsory insurance" or "third party damages").




I have suffered damages in my house as a result of the Volcano Eruption in La Palma but I do not have an insurance policy. Am I entitled to compensation through the Consortium?


No, only those damages that affect persons or property for which an insurance policy has been taken out with any authorized insurance company can be compensated by the Consortium, and provided that the policy is in force at the time of the damage and the insured is up to date with the payment of the premium. In other words, if you did not have a policy in force or up to date with the payment of the premium, you cannot claim compensation.




I have suffered loss of benefits Insurance Compensation Consortium: Am I covered?


In order to be covered for loss of benefits through the Consortium it is necessary:

  • that this risk is expressly insured in the policy;

  • that this loss is the consequence of direct damage to the insured property, and

  • that such property is owned or at the disposal of the insured.



Fotos: Saul Santos / Eltime.es (19.09.2021)


REQUIREMENTS FOR COMPENSATION


Are all damages (personal and/or material) compensable if they are caused by an extraordinary risk?


No, only those damages affecting persons or property for which an insurance policy has been taken out with any authorised insurance company, and provided that the policy is in force at the time of the damage and the insured is up to date with the payment of the premium, are indemnifiable by the Consortium.


The Consortium is responsible for the compensation of the damage on the basis of the same policy contracted with the insurance company. This means that, at the time of indemnifying, the Consortium will take into account the same assets, the same insured capital and the rest of the conditions (first risk, indemnity limits, etc.) established in that insurance policy for such contingencies.



Useful Links:

Insurance Compensation Consortium: https://www.consorseguros.es/web/inicio

Application for Indemnity Claims related to the Volcano Eruption in La Palma - Consortium: https://www.consorseguros.es/web/ambitos-de-actividad/seguros-de-riesgos-extraordinarios/solicitud-de-indemnizacion



Pasos a seguir en la solicitud de indemnización por daños materiales - Erupción del Volcán en La Palma
Steps to follow in the application for compensation for material damage - Eruption of the volcano on La Palma



Open the claim for damages caused by the eruption of the volcano of La Palma.


You can proceed to apply for compensation electronically to the Insurance Compensation Consortium through the following link: https://www.consorseguros.es/web/ambitos-de-actividad/seguros-de-riesgos-extraordinarios/solicitud-de-indemnizacion



Steps to follow in the application for compensation for material damage - Eruption of the volcano on La Palma


The application for compensation to the Consortium, both in the case of personal and material damage, can be presented directly by the insured person himself, by the policy holder or by their respective representatives, or through the insurance company with which the policy was taken out or through the insurance agent or broker who intervened in the contracting of the policy.


In the case of requesting compensation for material damage, it is necessary to present the request in one of the following ways: by telephone, by calling 900 222 665 or on-line, on the Insurance Compensation Consortium’s web page. (See the section on Requesting Compensation by clicking here).


In the case of requesting compensation for personal injury, (death; partial, total or absolute permanent disability; or temporary disability) the application can be submitted in one of the following ways: by telephone, by calling 900 222 665, or online on the Insurance Compensation Consortium’s web page.


In all cases, the application should be made as soon as possible: the less time elapses between the occurrence of the damage and the application for compensation, the sooner the corresponding processing will be carried out.



Opening the claim for damages caused by the eruption of the volcano of La Palma.


When starting the application for compensation through the Consortium's website, it is essential to have the following data in order to record them on the different screens:


  • Details of the insurance policy: insurance company and policy number.

  • Details of the person submitting the application for compensation online and of the insured person, if they are different people: name and surname or company name; NIF or CIF; address and contact telephone numbers.

  • Bank details for the payment of the compensation: the International Bank Account Code IBAN (24 digits) made up of two alphabetic characters that indicate the country and two control digits, number of the bank, number of the branch and number of the current account.

  • In the case of damage to motor vehicles: make, model and registration number of the damaged vehicle. If the vehicle is in a garage to be repaired, it is necessary to provide the name, address and telephone number of the garage in order to speed up the assessment of the damage.

The user, once identified by means of their corresponding passwords, will follow the steps marked by the different screens that are shown in the process, at the end of which the registration number assigned to their application will appear (a number that they will also receive by e-mail), and which they should use as identification for any information they require or query they wish to make in relation to the application.


Also at the end of the compensation application process, the website offers the user the possibility of attaching files containing the documentation described in section 11 below.



It is also possible to submit applications by telephone 900 222 665 (from 09:00 to 18:00 hours, Monday to Friday), but we recommend that you do the whole process online and use the telephone only in case of urgency, or later, to check if there is any progress.




And then what happens ?

Subsequently, the insurance expert assigned by the Consortium to assess the damage will contact the applicant to arrange a visit and examine the damage. To facilitate this appraisal and speed up the processing of the file, it is necessary to follow the instructions below:


  • Keep the remains of the damaged goods at the disposal of the expert and, if this is not possible, take photographs before removing them.

  • Keep the invoices in case any repairs have to be carried out urgently.

  • To have, at the time of the visit of the insurance expert, the estimates and invoices for the repair of the damage and two copies (original and copy) of the policy and the receipt for payment of the premium corresponding to the period in which the damage occurred, in order to provide the expert with a copy of both documents, as well as a receipt or bank document stating, for verification, the bank account IBAN code (24 digits) to which the compensation has been requested to be paid.


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