Insurance in Spain
As in most European countries, the need for insurance cover is not questioned. In Spain, however, insurance is a relatively new concept to most people. In the past, most Spaniards owned very little, so there was little point in insuring it. Unfortunately, while their wealth has increased over the years, their ideas on insurance hasn't changed.
So how does this effect a 'foreigner' living in Spain? Well first of all you will probably own a car or other vehicle. Currently it is estimated that about a quarter of all Spanish car drivers are said to use their vehicles without any insurance, although this is increasing rapidly as the police are able to road side checks via computers. This can severely affect you if you are involved in an accident with one of those uninsured. If the accident was the other driver's fault, you will be unable to claim on his or her insurance. So it is extremely important that you have comprehensive insurance that will cover you in such circumstances. It is said that one reason Spanish car insurance costs so much, is because the insurance companies have to cover the costs of claims for those not insured. Currently the police are having a concerted crackdown on uninsured drivers, so this situation should improve over time.
It is illegal to drive a vehicle without insurance in Spain, but that obviously hasn't stopped many drivers from trying to 'get away with it'. Until recently it was necessary for all drivers to carry their insurance policy with them as proof that they were covered by insurance. That has now been changed, with all insurance companies having to record all vehicle insurances with a central database. In the case of an accident in which the police are called out, they can instantly access this database at the roadside and check your insurance cover. Don't get caught out as the penalties can be high. Your vehicle may even be confiscated in addition to a hefty fine..
House insurance is the other cover most people moving to Spain will want to have. Most Spanish don't bother. If you are unlucky enough to have a break-in on your property, there is a fire (even in your neighbours adjoining property), you have subsidence (often prevalent in the countryside where the Spanish often build their own houses), etc. you should be able to claim.
Health Insurance is another must, especially if you have retired early but are not yet a pensioner, are self-employed, or just want instant attention when you are ill. Pensioners from other EU countries and those in employment and paying their taxes, automatically get health cover from the Spanish National Health service, however they must register at a Social Security office and get a Tarjeta Sanitaria (Health Card). The National Health Service in Spain is very good, but sometimes they seem to take their time (often a language misunderstanding problem), so you may be happier to have private health insurance as well as speak your language. There are many private hospitals and doctors in Spain, but always remember, they are in business to make money.
If you are not intending to live in Spain, but are just holidaying in Spain, most Travel Insurance should include cover for most health problems - but check the policy very carefully, especially the length of cover if you intend to stay for months and make sure it covers operations and not just minor treatments..
Pet insurance is another consideration, not just to cover for the animals illness, but in the event that your animal causes damage to property or people - as in causing a car accident. Make sure the policy covers operations. Many don't. Just because your pet is small doesn't mean operation costs are small.
One bit of good news for foreigners settling in Spain, is that there are a few insurance companies which specifically cater for English speakers. You can talk to them in English, get quotes in English and finally receive all your insurance cover documents in English.