The high‑altitude atmospheric depression (DANA) that struck Spain in October 2024 stands among the most destructive natural events of recent years, both in terms of human impact and material damage. As we have highlighted in previous analyses, insurance policies frequently exclude coverage for catastrophic events of this nature.
At Belzuz Abogados, S.L.P., particularly within our Insurance Law Department, we have received a significant number of enquiries from policyholders affected by the severe flooding that devastated the eastern and southern regions of the country—especially the Levante area—where unprecedented torrents caused tragic loss of life and extensive destruction of homes, vehicles, businesses, and critical infrastructure.
Rebuilding these communities will require substantial coordination and investment from public authorities, private entities, insurers, and society as a whole. In many cases, the homes, commercial premises, and vehicles swept away by the floods were insured, making it essential for affected individuals to review their insurance policies carefully and to notify their insurers promptly of any damage.
It is important to bear in mind, however, that Spanish insurance contracts typically exclude losses arising from force majeure and certain extraordinary risks. These risks fall under the jurisdiction of the Insurance Compensation Consortium (Consorcio de Compensación de Seguros, CCS). Article 6 of Royal Legislative Decree 7/2004 (approving the revised Statute of the Consortium) states that the CCS is responsible for compensating losses caused by extraordinary events that occur in Spain and affect insured risks located within the country. It also provides that personal injuries suffered abroad may be covered if the insured person habitually resides in Spain.
Extraordinary natural risks include earthquakes, tsunamis, abnormal floods, volcanic eruptions, atypical cyclonic storms, and the impact of celestial bodies. Royal Decree 300/2004, which regulates extraordinary risk insurance, defines extraordinary flooding as the overflow of riverbeds or natural watercourses due to rainfall, melting snow, or the overflow of natural bodies of water, as well as coastal flooding caused by sea surges.
The regulation also differentiates between extraordinary and non‑extraordinary events: insurers—not the CCS—must cover damages resulting from structural failures in man‑made water infrastructures (such as dams or canals) when the failure is not attributable to an extraordinary event. Similarly, insurers remain responsible for damage caused by rain falling directly on insured property or water collected through roofs, patios, or drainage systems.
In practical terms, this means that damage caused by rainwater falling directly onto a building (such as dampness due to accumulated rainfall) should be covered by the insurer, while damage resulting from the overflow of a river or natural channel—such as floodwaters coursing through streets—is handled by the CCS.
Policyholders should also be aware that, in order to access CCS compensation, they must hold an active insurance policy with premiums fully paid, since a surcharge for CCS coverage is included in many types of insurance—such as land vehicles, fire and natural hazards, property damage, various financial losses, and motor civil liability insurance.
Another requirement for activating CCS coverage is that the extraordinary risk must be excluded from the primary insurance policy, or that—even if included—the insurer cannot assume the loss due to insolvency or bankruptcy.
Ultimately, the CCS functions as a second layer of protection, stepping in when extraordinary events occur and the primary insurance policy does not provide coverage. In many cases, the compensation granted by the CCS aligns with the terms of the insurance policy itself, which is why insured individuals must review their policies to determine whether extraordinary risks are excluded and whether the Consortium’s intervention should be triggered.
From a broader perspective, extraordinary risk insurance offers significant advantages for policyholders. It allows insurers to exclude certain catastrophic risks without leaving consumers unprotected, and it provides wide‑ranging coverage at highly competitive costs thanks to the collective system managed by the CCS.
Despite being created over seventy years ago, in 1954, the Consortium has become one of the cornerstones of Spain’s advanced catastrophic risk‑management system. Its mission aligns closely with the principles of the social‑welfare model, ensuring that no insured individual is left without protection in the aftermath of a disaster.
At the Insurance Law Department of Belzuz Abogados, S.L.P., we remain at your disposal to review and assist with any insurance or liability matters with the utmost professionalism, efficiency, and reliability.