Decennial insurance is one of the products that raises the most questions among clients. At least, that is what we have observed through our experience as an insurance brokerage. For this reason, in this article we answer the main questions you may have about it.
What Is Decennial Insurance and What Is It For?
Decennial insurance is a policy whose purpose is to provide ten-year protection against damage to the building caused by the construction itself or by deterioration of structural elements.
All this damage may affect the mechanical resistance and stability of the home, causing serious damage and high repair costs.
In these cases, decennial cover would respond without the property owner having to face the situation with their own financial resources.
When Is Decennial Insurance Required?
The Spanish Building Regulation Act (LOE) requires builders of residential buildings to provide this cover.
Specifically, the law establishes that public deeds declaring new construction may not be authorised or registered in the Land Registry for buildings to which the law applies unless the guarantees referred to in Article 19 are evidenced and recorded.
Article 19 regulates the arrangement of decennial insurance.
The only case in which this insurance is not required is when a home is purchased by one private individual from another for their own use.
In cases where the construction has already been completed and one private individual sells to another a home that is not newly built, these guarantees would not exist.
What Risks Does Decennial Insurance Cover?
This insurance covers damage suffered by the building caused by foundations and structural elements where there is a risk of building collapse.
It may also cover damage caused to the development or urbanisation attached to the home.
What Risks Are Not Covered by Decennial Insurance?
Any damage caused by deficient building maintenance will not be borne by the insurer, because property maintenance is not the obligation of the developer but of the homeowners.
Damage caused by later modifications and renovation works will also not be covered unless there is a specific complementary guarantee for that situation.
Damage caused by explosion and fire is also not covered.
Is Decennial Insurance Mandatory?
As mentioned above, it depends on the conditions of the purchase. Newly built homes are required to offer this insurance.
If you would like to ask any question about a decennial insurance policy, contact our team without obligation.