This blogpost provides a comprehensive guide to insurance considerations for expat freelancers in Spain. Here are the key takeaway action points:
Insurance is one of those facts of life that you just have to face up to and accept. So rather than sticking your head in the sand and hoping you’ll just strike lucky, get informed with our guide on insurance for expat freelancers in Spain.
We’ll start with all the mandatory elements that you simply can’t avoid, so you can work out the expenses and budgeting as you start your freelance journey. Then, we’ll move onto the optional extras that will give you more peace of mind as you grow your own business in Spain.
But before we start, we’ll go over some key Spanish words to understand all kinds of insurance policies, then some FAQs to clear up any key questions.
While income tax, VAT, and social security contributions are mandatory, there are no insurance obligations for freelancers and self-employed workers in Spain. However, if you use a vehicle for work, employ staff, or have safety risks as part of your work, you will need specific insurance before you can launch your business.
For freelancers in Spain, any insurance related to your business activity is tax deductible. This includes obvious areas such as liability and vehicle insurance for your business, but you can also write off private health insurance and travel insurance if it’s necessary for your job.
When choosing insurance providers in Spain, self-employed expats should look for the following perks:
There are a wide variety of national insurance companies in Spain, such as Vidacaixa, Mapfre, and Mutua Madrileña. However, you can also look to multinational giants such as Allainz, Axa, and Zurich.
For specific insurance policies, you might have to dig a little deeper. For example, Cigna Global might have the best price for your needs, but does it have as many branches as Sanitas?
Obligatory insurance for expat freelancers in Spain includes:
Spain has a national health service that offers free healthcare for all residents. As an expat freelancer in Spain, you pay monthly social security contributions, called the freelance quota, that give you full access to the health system and pays into your retirement fund.
Technically, this isn’t insurance, but for those of you coming from the USA, it’s important to note that you don’t need to take out medical insurance on top of your social security contributions. That said, many solos choose to go private for a more efficient service, but this doesn’t exempt you from paying into the system.
As of January 2023, the amount that expat freelancers in Spain pay for social security is linked to their predicted income. While it is possible to pay more than your minimum income-linked rate, very few self-employed workers choose to do this, as their health needs are covered with a minimum payment.
Vehicle insurance is obligatory for expat freelancers in Spain, whether your vehicle is for personal or business use. As a minimum, you’ll need to take out third party insurance, or seguro a terceros, to cover third parties, fire and theft.
Comprehensive insurance, or seguro a todo riesgo, is the preferred option for most motorists. Yes, you pay more on your monthly premium, but you don’t have to pay anything in case of an accident — even if you’re at fault.
Top tip: If you’ve built up your freelance business to the point you have an entire fleet of vehicles, you can often insure them all in one go at a cheaper rate than each one individually.
While we’re on the subject of driving, bear in mind that you may have to exchange your non-EU foreign driving license for a Spanish one.
Expect to pay around €340.00 per year for vehicle insurance in Spain.
The scope of expat freelancer insurance in Spain really depends on what profession you’re in. If you’re a software engineer or a marketing consultant, it’s unlikely you’ll need to concentrate on this part, but if you’re a freelance builder or plumber, you’ll need liability insurance.
Liability insurance is mandatory for jobs that could damage people or the property or belongings of others. Similarly, any expat freelancers in Spain with a business that is open to the public, like a store or workshop, need liability insurance to secure a permit to open. It covers you in case of mistakes by either you or your team, and is a far better option than paying out-of-pocket for bills that could go into the millions.
It’s hard to calculate exactly how much a liability insurance policy will cost, due to the wildly varying factors at play. But if you fall into the category where it is obligatory, shop around for liability insurance for self-employed workers, and reach out for help from professionals.
Industrial injury insurance, or seguro de convenio, is a mandatory insurance for expat freelancers in Spain who employ others. It pays out in cases of injury, disability, or death of your staff, so you can understand why you need it. There’s quite a penalty if you ignore it too — a fine of up to €190,000!
Depending on the risks involved in your line of work, the yearly premiums you’ll pay for industrial injury insurance will vary massively. We’d recommend speaking to a financial specialist for guidance on the best options for your situation.
The list of optional insurance for foreign self-employed workers in Spain is a longer list, including:
You might not consider your pension a kind of insurance in the traditional sense, but it ultimately protects you during your retirement.
Pensions are an incredibly important form of insurance for expat freelancers in Spain as a self-employed worker receives, on average, just 59.4% of a salaried employee’s pension. This is because most solos pay a minimum social security quota and consequently receive less in their retirement.
Therefore, it’s common for solos to pay into a private pension fund if they’re planning on staying in the country long term. Many insurance companies in Spain offer pension plans that are customized for freelancers, so keep an eye out and ask the right people.
As we mentioned earlier, your freelance quota is a mandatory payment that gives you access to the national health service, so you can get a checkup or medicine when you’re sick.
Many self-employed workers register for private healthcare for shorter waiting times and more variety. Expat freelancers in Spain also appreciate private health insurers because you’re far more likely to find an English-speaking doctor. When you’re in an urgent, stressful situation, you hardly want to be checking your phrasebook.
Dental insurance is often covered in the costliest private health insurance policies, as are medical expenses incurred while traveling. We’d encourage you to think seriously about exactly what you need and do a lot of research before committing.
For the most wide-reaching private health insurance, you’re looking at around €1800 per year, so make sure you can budget it in before you go for it.
Your home is your castle, especially if you’re working from home. There are two main kinds of home insurance: building and contents.
Building insurance will pay out for issues with the structure of your home, and it is highly recommended if you’ve bought your own home. You’ll be covered against natural disasters such as fire or flooding, as well as leaks and other examples of poor construction. If you’re on the volcanic Canary Islands or in an area prone to wildfires, it’s better to be safe than sorry.
We’d highly recommend looking into contents insurance for expat freelancers in Spain. Coming home to find all your work equipment has vanished isn’t the greatest feeling in the world, and replacing everything you need can leave a deep hole in your pocket.
If you’re often on the move, go for a more comprehensive plan. The best home insurance policies in Spain will cover everything in your house while you’re traveling, and items like your phone and laptop while you’re away.
Your premium depends greatly on the kind of house you have and the contents within, but you should be looking to pay around €190.00 per year for home insurance in Spain.
Another non-essential kind of cover, life insurance is most important if you’ve got a family that depends on you. It’s not the nicest subject to think about, but with good life insurance, you can secure all the expenses related to your death as well as on-going payments such as your mortgage.
Expect to pay around €120 per year for comprehensive life insurance in Spain, which will normally rise year on year.
Got a furry friend to keep you sane when the work gets too much? Don’t leave yourself in the lurch if they get ill or injured.
Pet insurance lets you rest easy, safe in the knowledge that you won’t be bankrupted by vet fees. More advanced pet insurance will cover burial if the worst happens, and there are even insurance companies in Spain that deal with travel, theft, and assistance if your animal goes missing.
Clearly, pet insurance isn’t directly related to your business activity, but freelance life shouldn’t be all work no play, right? With €200 a year, you can cover pretty much any household animal in Spain, so factor that into your yearly outgoing costs.
Although it isn’t mandatory, travel insurance for expat freelancers in Spain can be a lifesaver when you’re on the move. Here, we’ll shed some light on the three main areas that travel insurance covers.
Health issues abroad, whether it is illness or a sports injury. Many private health insurance deals will cover you when you’re abroad, so if you can combine the two into one policy, that’s a wise bet.
Loss of personal property comes in very handy if your entire income comes through your laptop. But remember — you can get hardware replaced with travel insurance, but you should always keep backups securely on the cloud or a hard drive.
Canceled flight cover is ideal if you’re going long distances and stumping up a large sum for your travels. You’ll get all your expenses paid, like an overnight hotel and alternative routes, which can climb up into thousands of euros if you don’t have insurance.
Depending on how long you’re freelancing in Spain, you can get travel insurance for a single trip, multiple trips, or a full year. Unless you’re taking exceptional risks or carrying around a Fabergé egg, you can get worldwide annual cover for around €50 per year.
It’s hard to get absolutely everything right about insurance as a freelancer in Spain — especially when you’ve got deadlines to meet, invoices to write, and bills to pay.
That’s why so many solos are looking to all-in-one accountancy services like Xolo to take care of all the confusing admin and free up a day every month to invest in their business.
When you sign up to Xolo, you get an intuitive dashboard that simplifies your finances as an expat freelancer in Spain:
✔️Automated invoicing and accounting
✔️Business expenses management
✔️Tax estimates and forecasts for every quarter
But unlike more simple platforms, The Xolo team is at hand to advise you on insurance or any other aspect of freelance financing. Just a phone call away, our multilingual experts are happy to help you:
🔥Getting insured as a freelancer
🔥Wide-reaching legal advice
🔥Annual income tax returns
So if you want to grow your own business in Spain but don’t want to suffocate in a world of red tape, sign up for Xolo and get your business on the path to success.
James McKenna has been a freelancer since 2017, working in subtitling, translation, and his main passion — writing. He loves nothing more than falling down a rabbit hole, a habit that has helped him specialize in areas as diverse as biotech, climate change, higher education, and business strategy.
Based in Barcelona, James learned the ropes the hard way, making mistakes that turned into valuable learning experiences. After working hard to establish himself, he is now working smart, and is always on the lookout for ways to streamline his business.