The Ley de Arrendamientos Urbanos sets the shape of every residential letting in Spain. Article 36 requires a fianza of one month’s rent for a home — two for any other use — paid in cash on signature and lodged by the landlord with the regional housing body for the life of the contract. That deposit is the law’s own security, it is the same for every tenant, and nothing on this page touches it.
What varies is what sits on top. Since 2019 a landlord may ask for additional security of up to two months’ rent on a contract of up to five years, and in practice that is where a letting is won or lost. The agency asks for a bank aval, or for two further months in cash, or for a payslip from a permanent contract — and a tenant who has just arrived in the country, works on a temporary contract or is simply young will often have the income for the rent and not the cash or the paperwork for the guarantee. The flat goes to someone else, and the landlord has not gained a better tenant, only one with a thicker file.
A caución de alquiler is a seguro de caución in the sense of article 68 of the Ley de Contrato de Seguro, written for that gap. The tenant is the tomador; the landlord is the asegurado. If rent agreed under the lease goes unpaid, the landlord is indemnified up to the months the policy states — the same months the additional security would have covered — and what the insurer pays is owed back to it by the tenant. The landlord holds a supervised insurer’s undertaking instead of a bank’s or a relative’s, the tenant keeps the cash, and the legal fianza stays exactly where the law puts it.
It is not the policy landlords already know. A seguro de impago de alquiler is bought by the landlord, covers a year or more of defaults and legal costs, and is priced on the landlord’s whole exposure. A caución is bought for the tenant, covers the agreed security and nothing more, and is priced on the tenant. The two can coexist on one lease; what the caución replaces is the aval and the extra months in cash, which is what the tenant could not produce.
We designed ours for the tenants the aval excludes, and that decision drives everything else about it. The premium is set for a household rather than a company — deliberately low, paid once — so a guarantee of two months’ rent costs a fraction of what lodging two months in cash costs a tenant who has just paid the fianza and the agency. And the term runs for up to 24 months where most rental guarantees on the Spanish market stop at twelve. That matters more than it sounds: an eviction for non-payment can take many months, sometimes more than a year, to run its course, and a landlord whose guarantee lapsed halfway through a dispute has a piece of paper. A guarantee that lasts the lease, and the dispute, is the certainty a landlord is actually buying.
The flexibility is the other half of the design. The cover follows what the lease actually provides for — one month of additional security or two, one tenant or several co-tenants on a single contract, a term of six months or two years — and it is renewed when the lease is extended and released when the lease ends early. Neither the tenant’s nationality nor the employer nor the length of time in Spain is a condition of applying. What is assessed is whether the rent is affordable and has been paid before, which is the only question the aval was ever a proxy for.
The technology is what lets a real estate agency use it in the time a letting takes. An agency that has joined signs in to its own secure area on this site and quotes the policy in real time — the premium appears as the rent, the term and the months of security are entered, before anything is submitted. Submission sends the file to an automatic scoring model built for residential tenants and assisted by AI, which reads income, stability and the payment history the tenant has consented to share; an underwriter reads the cases the model is unsure of. The answer comes back within three hours at most, and usually far sooner. The agent then pre-approves the policy, the tenant receives it by email and signs it with a one-time code sent to their phone — an electronic signature the eIDAS Regulation recognises — and the certificate reaches the landlord the same day. Nothing is posted, and nobody visits a bank. The scoring decides whether we issue and at what premium; it does not replace the agency’s own checks on the lease, the identity of the parties or the condition of the property.
Three things are worth saying plainly. The programme is for real estate agencies, and a broker is welcome where it brings an agreement with a chain or network of agencies — the enquiry form on this site is the way in for both. It is for Spain only: residential leases under the LAU, agencies established in Spain, in Spanish, distributed through our associated managing general agent for the Spanish market, which gives an agency its access once it has joined. And what stands behind every certificate is the balance sheet we publish in full, filed report by filed report, in the solvency section of this site — the same capital that stands behind a garantía definitiva lodged with the Caja General de Depósitos.
Written by the underwriting team at FDI Insurance d.a.c., Dublin. This piece is general information, not advice on any particular transaction — and it is not an offer of insurance.
