This week, in my day-to-day work, several clients have asked me – more out of curiosity than because of a real situation, as there has been no blackout in the Balearic Islands – how their insurance would respond in the event of a blackout causing damage. With this in mind, I have prepared a brief summary of the coverages that could be activated in your policy.
How does my insurance protect me for a blackout like the one on Monday 28 April in Spain?
The first cover that could be used in your insurance would be electrical damage cover, this can apply to the building (if there is damage to the electrical installation of the home, for example, although this is rare) or to the contents, i.e. if an electrical appliance such as a television or computer is broken when it is suddenly switched off.
Bear in mind that most insurers have an age limit for reimbursable household appliances, i.e. they will pay for appliances that are normally no more than 8 years old and after a visit by a technician who verifies the origin of the damage.
This cover can be found in home, commercial or community policies and is often found in the aftermath of severe storms.
Another coverage that could be activated after a blackout is the coverage for food spoilage in refrigerator appliances, this usually has a limitation of hours, that is, it is activated if the refrigerator or freezer has been turned off for at least X hours (varies according to company and policy), in this coverage it is very important that you take photos of the food before throwing it away, since you rarely have the purchase receipts.
You can find this coverage in your business insurance. If you own a hospitality business and don’t have it, ask your manager. This coverage can save you a lot of trouble for very little money. You can also find it in home insurance.
Accidents can also occur due to a power outage. Imagine a leaking water pump when it’s turned off. This water damage is due to the power outage. Although the pump itself isn’t damaged, the water has caused damage to the home, and that damage will need to be repaired.
Loss of profits is another coverage that could be activated in certain cases and under very specific policy conditions. Since COVID, this coverage has almost disappeared and in other cases has been greatly restricted. What is compensated is the loss of business, that is, I can’t open my restaurant because I have no electricity, although it usually has many restrictions and is usually difficult to apply.
These are, in my opinion, the main covers that your insurance offers in the event of a blackout. If, after reporting the damage to your company, the damages are compensable according to your policy, it will be your company who will subsequently claim from the electricity company.
I hope this post will help you to better understand the coverages of your policy and how they work in special situations such as a power outage. In the blog you will find clear and simple information about home insurance, community, commercial and more, if you want a no obligation quote contact us.