The Canarian Government estimates that the lava from the Cumbre Vieja volcano will leave more than €400 million in losses. At Seguros RGA, we explain how mortgage insurance helps to recover from material losses from extraordinary risks like this one.
The lava from the volcano has already affected more than 200 homes and more than 100 hectares of crops and farms. Photo: ACFI Press
The lava from the Cumbre Vieja volcano, which erupted last Sunday, September 19, has already destroyed some 200 homes and more than 100 hectares of crops. The Canarian Government estimates the losses that this phenomenon of nature will leave at more than 400 million euros, which has forced the eviction of 6,000 people from their homes.
Fortunately, in the case of the La Palma volcano, there is no need to regret the loss of human life at the moment. But the lava has buried or destroyed properties, assets, and memories that, in many cases, are irrecoverable. Hence, both those directly affected, as well as society as a whole, wonder how affected families, businesses, and farms will be able to recover from the material damage caused by the Cumbre Vieja volcano.
Insurance, an ally for the victims of the volcano
The information repeats ad nauseam that “insurance does not cover extraordinary risks.” Said like this, it would seem that insurance ignores its clients in the face of an extraordinary risk such as a volcano or a DANA.
Indeed, home policies or car insurance do not include this protection, but they do guarantee the corresponding compensation through the Insurance Compensation Consortium, a single body in Europe to which we insurers allocate a percentage of the amount of each policy to cover extraordinary events such as the eruption of the La Palma volcano.
To access compensation from the Consortium, it is essential to have taken out insurance that protects the property that has been damaged. The amount of the same will be linked to the sum insured in each policy.
How to request compensation from the Insurance Compensation Consortium?
Families whose material assets have been affected by the lava from the volcano can contact the Consortium directly by calling the freephone number 900 222 665, also through the website of this organization.
In the case of clients of Seguros RGA and Cajasiete affected by the lava from the Cumbre Vieja volcano, we make ourselves available to those affected to carry out, on their behalf, the procedures before the Insurance Compensation Consortium. Remember that you can contact us through the telephone numbers 91 700 7000 and 900 33 66 00. The Consortium itself suggests that this route be used, through the insurer or a mediator, due to the active circumstances of the volcano that prevents access to affected assets.
“This usual practice consisting of the insured asking his insurer or his insurance broker to take care of requesting compensation from the CCS on his behalf can be especially recommended in those cases in which, as will frequently happen in this episode of eruption volcanic (…) the insured does not have all the necessary data on the insurance policy, data that will be included in the files of the insurance company or the insurance broker through whom the insurance was contracted,” says the Insurance Compensation Consortium.
What happens if the property affected is a business or office?
The lava from the La Palma volcano has not only buried homes. Offices, shops, and public buildings have also been affected. Having multi-risk insurance is also a guarantee for the Insurance Compensation Consortium to assume compensation for damage and loss of benefits as a result of the disaster.
In these cases, such as with the home or the car, the file can be managed directly with the Consortium or through Seguros RGA if you are our client.
The volcano, active since Sunday, has already damaged more than 200 homes. Photo: ACFI Press
What happens to the crops and agricultural or livestock farms destroyed by the lava?
Agricultural insurance does not include compensation for events such as the Cumbre Vieja volcano. And in these cases, the Insurance Compensation Consortium does not intervene either. Agroseguro, the public-private entity that manages the protection of agricultural and livestock farms, covers against weather damage, pests, or diseases, but the law does not provide protection against events such as the one on the Canary Islands. In fact, Agroseguro has posted 13 experts in the Canary Islands to expedite the files linked to this summer’s heatwave, which caused losses, especially in banana crops on La Palma.
This does not mean, however, that farmers and ranchers will be left unprotected in the face of the disaster caused by the lava. The Government is working on declaring the affected areas of the island as “area seriously affected by a civil protection emergency,” according to President Pedro Sánchez after the Council of Ministers on Tuesday.
The declaration of a catastrophic area will allow farmers and ranchers to recover part of the losses on their farms, also to families that do not have their assets insured, although the amount will depend on what the Government sets in each case.
