Your insurer denies the claim over a clause you never signed

The case, in five lines

What is brought

An action to enforce the insurance contract: you claim the agreed benefit plus the insurer's late payment interest, denying effect to the limiting clause that was neither highlighted nor accepted in writing.

Before which court

The Civil section of the Tribunal de Instancia (the first-instance court), through whichever declaratory route matches the amount claimed under the Ley de Enjuiciamiento Civil (the Spanish civil litigation statute).

Deadline

Two years for property insurance and five for personal insurance, under Article 23 of the Insurance Contract Act. Time does not stop merely because the file remains open at the company: what interrupts it is a written claim with proof of receipt.

Who can bring it

The policyholder, the insured and the beneficiary under the contract. In liability insurance, also the injured third party, whose position on late payment is expressly covered by Article 20 of the Insurance Contract Act.

Financial risk

If the court holds that the clause merely defined the risk covered and was properly drafted, the claim is dismissed and you may bear the costs. Your own expert report is paid up front and is not always recovered.

A clause that cuts down your rights has to be signed

Article 3 of the Insurance Contract Act imposes three cumulative requirements. General conditions may never be harmful to the insured. They must be included in the insurance proposal, if there was one, and necessarily in the policy or in a supplementary document that the insured has to sign, a copy of which is handed over. And the conditions, general and particular alike, must be drafted clearly and precisely. That is the floor of the contract, not a recommendation of good practice.

On top of that floor the provision adds the rule that decides your case: clauses limiting the rights of the insured shall be specially highlighted and must be specifically accepted in writing. Two separate requirements, both of them necessary. An exclusion printed in the same typeface as the rest of the conditions is not highlighted. And a policy signed only on the last page does not prove specific acceptance of that particular clause.

It is the insurer that must prove it met both requirements, because it drafted the document and it is the one relying on it. That is why the firm's first letter demands the full policy, the set of conditions it says it delivered, and the document bearing your signature next to the exclusion. If that document does not turn up, the case changes ground before it even starts.

Defining the risk is not the same as cutting your rights

The company's usual defence is to argue that the clause limits nothing, that it merely defines the risk covered, and that for that reason it needed no highlighting or separate signature. That is the real battleground of the case. The line is drawn by asking what the person who took out the policy could legitimately expect: if the clause cuts back cover that the insured believed was there on the strength of what was offered, it is a limiting clause and specific signature was required.

The same Article 3 offers a second line of attack that should not be wasted. It requires clear and precise drafting and forbids general conditions from being harmful to the insured. An exclusion worded so as to empty in practice the cover that was sold is fought on both fronts at once: as obscure and as harmful. There is no need to choose between the two arguments, they are put forward cumulatively.

That is why the pre contractual material weighs so heavily. Article 3 requires the general conditions to be included in the insurance proposal where there was one, so the commercial offer, the intermediary's email and the summary of cover you were shown stop being advertising and become evidence of what was offered to you and of what later appeared in the conditions.

Late payment interest runs from the day of the loss

Article 20 of the Insurance Contract Act sets out when the insurer is in default: when it has not performed within three months of the loss occurring, or when it has not paid the minimum amount it may owe within forty days of receiving the notice of loss. These are two independent breaches, and either one is enough.

The consequence is imposed by the court of its own motion, without you having to ask for it: an annual interest equal to the statutory interest rate in force when it accrues, increased by fifty per cent, accruing daily and with no need for a judicial demand. And once two years have passed since the loss occurred, that annual rate may not fall below twenty per cent.

Time starts running from the date of the loss, not from the rejection or the claim form. Only if you failed to notify the loss within the period stated in the policy or, failing that, within seven days of becoming aware of it, does time start on the day of notification. That is why the date of the loss report is one of the first documents requested.

A justified reason is the only way out left to the insurer

Article 20 closes with a narrow exception: no default interest is due where the failure to pay rests on a justified reason or on one not attributable to the insurer. Half the case is argued around that sentence, because the company will try to present its refusal as a reasonable doubt about cover rather than as a refusal to pay what it owed.

The argument weakens when the excuse is precisely the clause that was neither highlighted nor signed. Grounding the refusal on an exclusion that fails Article 3 is not a reasonable doubt about cover, it is applying a condition that never became part of the contract. That link between the two articles is what wins the case in full rather than by halves.

It is also worth knowing that the same article applies to delay in repairing or replacing the damaged item, not only to payment in money, and that in those cases the base for calculation is the net cost of that repair. It also expressly rules out Article 1108 of the Civil Code, so the insurer cannot argue for ordinary interest instead.

Two years or five: the deadline depends on what you insured

Article 23 runs to a single line and decides many matters before they are ever argued: actions arising from an insurance contract are time barred after two years for property insurance and after five for personal insurance. There is no intermediate period and no exception for the insured's good faith.

The distinction is not always obvious. A home policy is property insurance, yet it may include personal accident cover for the occupants, and what is claimed under that cover follows the five year rule. The classification is made by reference to the specific benefit you are claiming, not to the commercial name of the product sold to you.

The costliest mistake is letting time run while emails go back and forth with the claims department. Telephone conversations and adjuster visits leave no usable trace. What interrupts the limitation period and reopens it in full is a written claim addressed to the insurer with proof of receipt, identifying the loss and the amount claimed.

Before suing you must have negotiated, and be able to prove it

Article 5 of Organic Law 1/2025 makes prior recourse to an appropriate dispute resolution mechanism a condition of admissibility. For it to be satisfied there must be identity between the subject of the negotiation and the subject of the litigation, even though the remedies later sought may vary. Without proof of that step the claim is not admitted, and meanwhile the Article 23 period keeps running.

The rule itself states that the requirement is satisfied in particular where the negotiating activity is carried out directly by the parties or between their lawyers, under their instructions and with their agreement. In an insurance matter that means a reasoned demand, stating the amount and the grounds, addressed to the insurer, together with a record of its reply or of its silence.

There are useful exceptions. The same article provides that no appropriate dispute resolution mechanism is needed to apply for interim measures before the claim or for preliminary enquiries. If there is a risk that the evidence of the damage will disappear, that route allows immediate action without waiting for the negotiation to close.

How we run the case, step by step

1. 1

   Reading the policy and the rejection letter

   The commercial offer is compared with the signed conditions and the clause relied on is located. We check whether it is specially highlighted and whether specific written acceptance exists. That produces the opinion on whether the matter stands up.

2. 2

   Formal demand to the insurer

   A reasoned letter is sent quantifying the benefit, relying on Article 3 against the exclusion and warning of the interest accruing under Article 20. It interrupts the limitation period and serves as the prior negotiating activity.

3. 3

   Independent expert report

   An expert of our choosing examines the damage, its cause and its valuation, and answers the company adjuster's report. Without opposing expert evidence the court has before it only the version of the party that refused to pay.

4. 4

   Closing the prior negotiation

   The attempt at agreement required by Article 5 of Organic Law 1/2025 is documented, with identity between what is negotiated and what is later claimed. If the company improves its offer, it is assessed in writing before acceptance.

5. 5

   Claim before the Civil section

   We seek the benefit, the Article 20 interest from the date of the loss and the costs. The claim attacks the exclusion as not highlighted, as not accepted in writing and, in the alternative, as harmful and obscure.

6. 6

   Enforcement and actual payment

   Once judgment is obtained, we monitor payment in full, including interest up to the day the indemnity is actually paid, which is the end point fixed by Article 20 itself.

The law that applies

• Art. 3 LCS. General conditions may not be harmful to the insured, must be included in the insurance proposal where there was one and necessarily in the policy or in a supplementary document signed by the insured, who receives a copy, and must be drafted clearly and precisely. Clauses limiting the rights of the insured must be specially highlighted and specifically accepted in writing. Once the Tribunal Supremo declares a clause void, the Administration requires identical clauses to be amended. BOE-A-1980-22501
• Art. 20 LCS. The insurer is in default if it fails to perform within three months of the loss or to pay the minimum sum owed within forty days of the notice of loss. Default compensation is imposed by the court of its own motion and consists of the statutory interest rate increased by fifty per cent, which may not fall below twenty per cent once two years have passed since the loss. Time runs from the date of the loss, and none is due where the failure to pay rests on a justified reason or one not attributable to the insurer. BOE-A-1980-22501
• Art. 23 LCS. Actions arising from an insurance contract are time barred after two years where the insurance is property insurance and after five where it is personal insurance. BOE-A-1980-22501
• Art. 5 LO 1/2025. It makes prior recourse to an appropriate dispute resolution mechanism a condition of admissibility in civil matters, with identity between what is negotiated and what is litigated. It is satisfied by mediation, conciliation, a neutral expert opinion, a confidential binding offer or direct negotiation between the parties or between their lawyers. It is not required for enforcement claims, prior interim measures or preliminary enquiries. BOE-A-2025-76

Each article checked against the consolidated text published in the BOE (the Spanish official gazette).

Frequently asked questions