Expat Life Insurance in Spain: Options, Requirements, and Application Process

Some Spanish life insurance policies provide international coverage, while others only offer local protection. Additionally, policies vary in costs, duration of coverage, and their potential to build cash value.

This article explains how expat life insurance in Spain works and outlines the types of policies available to expats. It also discusses the requirements and process of purchasing a life insurance policy as an expat in Spain and highlights how international policies can offer additional flexibility for mobile expats.

How Does Life Insurance for Expats in Spain Work?

Life insurance, known as Seguro de Vida in Spain, provides regular or lump sum death benefit payments to designated beneficiaries in the event of the policyholder’s death.

The purpose of life insurance is to ensure financial security and protection for the insured’s family. The family can leverage the insurance payments to cover mortgage payments, funeral costs, living expenses, and outstanding debt.

Spanish life insurance policies are overseen by Dirección General de Seguros y Fondos de Pensiones (DGSFP), the government’s financial regulatory department that supervises all insurance activities.

Purchasing life insurance in Spain is not mandatory, although it’s often advisable for expats to ensure their family’s financial stability while living overseas and to support cross-border estate planning where family members or assets are located in more than one country.

What Are the Benefits of Expat Life Insurance in Spain?

Unlike traditional life insurance, policies designed for expats in Spain typically entail the following benefits:

• Personalised coverage: Life insurance policies for expats in Spain are tailored to align with your specific financial and residential needs, although the level of international validity varies between providers and should be checked carefully.
• Additional payment options: In addition to the death benefit, many expat life insurance policies offer additional coverage to ensure financial security in case you are diagnosed with a serious illness, such as cancer or heart disease.
• Cross-border tax efficiency: While life insurance policies are typically tax-efficient structures, those designed for expats in Spain may offer certain advantages depending on your tax residency, the policy structure, and the jurisdiction in which the insurer operates. These benefits are not automatic and depend on individual circumstances.

Consulting a financial adviser, such as the experts at Titan Wealth International, ensures you select an expat life insurance policy that provides international coverage.

We evaluate your residential and financial circumstances, as well as your retirement goals, to assist you in purchasing a policy that minimises taxes and maximises wealth preservation in a compliant and cross-border appropriate manner.

What Types of Life Insurance for Expats Living in Spain Can You Purchase?

Expats in Spain can obtain life insurance that provides local or international coverage, depending on their retirement goals, residency, and the options offered by their chosen provider.

Those intending to retire in Spain can benefit from local life insurance policies, while expats planning to repatriate or retire in another jurisdiction should consider policies with global coverage.

Whether you seek a local or international policy, you can consider the following types of expat life insurance in Spain:

1. Term life insurance
2. Whole life insurance (also referred to as permanent insurance in some jurisdictions)

Term Life Insurance

Term life insurance is the most popular type of life insurance for expats in Spain due to its affordability. This type of policy provides coverage for a fixed period, typically between 5 and 30 years, and its premiums are based on:

• Age
• Gender
• Health

If you die while the policy is still active, your beneficiaries receive the policy’s value as a death benefit. In case the policy expires before your death, your beneficiaries don’t receive any payouts.

Depending on your provider, you may be able to review or renew the policy upon expiration to extend the coverage or convert it to whole life insurance (subject to underwriting and provider rules).

Whole Life Insurance

Whole life insurance in Spain, also known as permanent life insurance, provides lifelong coverage and a death benefit for your beneficiaries. The coverage typically ends around the age of 80 or 85 depending on the insurer, and the payouts are guaranteed, which is why these policies incur higher costs than term life insurance.

In addition to death benefits, whole life insurance includes a savings component, structured as follows:

1. Each time you pay a premium, the payments exceeding the minimum required contribution are added to your cash value.
2. The cash value is invested in various assets, enabling you to increase the policy’s value.
3. The interest is typically accumulated on a tax-deferred basis and provides compound growth of your savings.

Additionally, you are allowed to withdraw or borrow funds from the cash value, but must maintain a sufficient balance to cover the cost of insurance. Otherwise, the policy will lapse.

While whole life insurance offers greater coverage than term life insurance, as well as wealth growth potential, it requires professional management and involves investment risk, as you can lose both the earnings and the capital if your investments underperform.

A financial adviser at Titan Wealth International will help you gain a thorough understanding of the whole life insurance policy’s features and develop an investment strategy that supports wealth growth.

Since whole life insurance demands careful planning and continual management, Titan Wealth International also assists you with securing appropriate cross-border ownership and beneficiary structures.

International Life Insurance Options for Expats in Spain

Expats living in Spain often have financial lives, families, and future plans that span more than one country. For this reason, many find that an international life insurance policy offers far greater flexibility than a policy restricted to Spain.

These policies are designed specifically for globally mobile individuals and cross-border households whose needs may extend beyond a single jurisdiction and may offer broader claim-servicing capabilities for beneficiaries living abroad.

Why International Life Insurance Might Be a Better Option for Expats

International life insurance policies allow you to maintain continuous protection even if you:

• Move to another EU or non-EU country.
• Return to your home country.
• Relocate abroad for work.
• Spend extended periods travelling.
• Expect future uncertainty in your residency.

This level of portability helps avoid the need to reapply for new cover later in life, when premiums may be higher or medical underwriting more restrictive.

Portability Across Countries

One of the main advantages of an international policy is its durability across borders. Unlike many Spanish domestic policies, which may only provide cover while you remain resident in Spain (or the EU), an international life insurance policy typically remains valid regardless of your next destination as long as the insurer can operate in that jurisdiction and you continue to meet the policy terms.

This makes international cover particularly suitable for expats who:

• Expect to move again.
• Maintain a global lifestyle.
• Work remotely or travel for long periods.
• Are unsure where they will retire.
• Have family members living in different countries.

Estate-Planning Flexibility

International life insurance policies often offer more flexible ownership and beneficiary structures than domestic Spanish policies.

Depending on the insurer and jurisdiction, international policies can allow:

• Assignment to a trust or foundation.
• Tailored beneficiary arrangements.
• More flexible succession planning.
• Support for multi-jurisdiction estates.

This is helpful for expats whose estate is exposed to more than one tax system — including EU, UK, or non-EU frameworks depending on domicile, residency, or asset location.

Currency and Beneficiary Flexibility

International policies typically provide options that are useful to expats whose financial lives extend beyond Spain.

These often include:

• Premium payments in multiple currencies (EUR, GBP, USD).
• Payouts in the currency most appropriate for beneficiaries.
• Reduced exposure to exchange-rate fluctuations.
• Simpler claims for beneficiaries living outside Spain.
• Clear cross-border documentation processes to reduce administrative delays.

For expats with family spread across different jurisdictions, or those who expect their beneficiaries to relocate, this can simplify administration and reduce potential delays.

Costs vs. Benefits

International life insurance policies can cost more than local Spanish policies because they offer:

• Higher levels of portability.
• Wider claim jurisdictions.
• Multi-currency options.
• More flexible beneficiary structures.
• Consistent cover if you move countries again.

For expats who expect their circumstances to change, or whose families are not based in one country, this added flexibility often outweighs the additional premium. Although suitability will depend on your tax position, intended length of stay in Spain, and long-term residency plans.

Comparing Spanish and International Life Insurance Policies

Below is a simplified comparison to help expats in Spain understand which type of policy might best suit their lifestyle and long-term plans.

For expats who expect to remain in Spain long-term, a Spanish domestic life insurance policy may be sufficient and cost-effective.

However, for those who:

• Expect personal or professional mobility.
• Have beneficiaries in different countries.
• Maintain assets in multiple jurisdictions.
• Require currency flexibility.
• Need long-term cross-border estate planning.

an international life insurance policy is often the most adaptable and secure option when matched correctly to your residency, tax position, and long-term mobility plans.

Residency and Visa Considerations for Securing Expat Life Insurance in Spain

In practice, most insurers in Spain will require a Green NIE or TIE card to confirm your legal residency in Spain when applying for a locally issued life insurance policy.

Requirements can vary between insurers, but proof of lawful residence and identity is generally mandatory. The table below offers additional details:

Tax Residency vs Immigration Residency

For expats in Spain, it is important to understand the difference between immigration residency and tax residency, as each affects life insurance in different ways.

Immigration Residency (NIE/TIE)

Your NIE or TIE confirms your legal right to live in Spain. Insurers usually require one of these documents to verify your identity, address, and lawful residence when you apply for a life insurance policy.

However, immigration status does not determine how your policy or its payouts will be taxed and does not, on its own, establish tax residency.

Tax Residency

Tax residency is based on your personal circumstances, not your visa or residence card. Under Spanish law, you are generally considered tax resident if:

• You spend more than 183 days per year in Spain.
• Spain is where your main economic interests are located.
• Your spouse or minor children habitually reside in Spain (presumption rule).

If you meet these criteria, Spain taxes you on your worldwide income and assets, including:

• Life insurance gains if you surrender a policy.
• Death benefits received by your beneficiaries, which may fall under Spanish Inheritance & Gift Tax (ISD) when either the policyholder or beneficiary is tax resident in Spain, or when Spanish-situated assets are involved.

Why This Matters for Life Insurance In Spain

Because immigration status and tax residency operate under different rules in Spain, expats can easily assume they are the same.

However, the two systems serve very different purposes, and the distinction has a direct impact on how a life insurance policy is assessed, taxed, and paid out.

Understanding how these residency categories interact is therefore essential for anyone taking out life insurance while living abroad.

This distinction is essential because:

• Insurers assess your immigration status to establish eligibility
• The Spanish tax authorities use your tax residency status to determine how your policy is taxed and whether beneficiaries fall under Spanish ISD rules.

For expats who divide time between Spain and another country, or who maintain global financial ties, tax residency can differ significantly from immigration status. This means the tax outcome of a life insurance policy may not align with what your residency card suggests.

Your tax residency affects:

• How surrender values are taxed: If you are a tax resident in Spain, surrender gains are usually taxed under the Spanish savings tax regime.
• Whether death benefits fall under ISD: Spanish inheritance tax applies to beneficiaries depending on regional rules, which can vary widely.
• Whether beneficiaries face cross-border tax obligations: This is especially relevant if your beneficiaries live outside Spain or are taxed in another jurisdiction.

Confusing the two can lead to unexpected tax liabilities for you or your beneficiaries, especially if you spend time in more than one country or maintain financial ties across different jurisdictions.

Before purchasing life insurance in Spain, it is important to confirm whether you are currently a tax resident, whether your beneficiaries are Spanish residents or non-residents, and which country has the right to tax the payout based on your residence, domicile, and the insurer’s jurisdiction.

Taking these factors into account helps ensure you choose a policy structure that aligns with your long-term financial and estate-planning goals while reducing the risk of unexpected tax consequences.

Key Requirements for Obtaining Expat Life Insurance in Spain

To apply for life insurance in Spain, expats must gather the following information and documents:

• Identification documents: A valid passport or national ID card, and a green NIE or TIE card (a Spanish DNI is issued only to Spanish nationals and is not applicable to foreign residents).
• Personal details: Name, date of birth, address, and other necessary information
• Medical information: Documents outlining the applicant’s medical history, including any pre-existing health conditions or medications, which is required to determine the risk level of the policy.
• Insurable interest: A statement explaining the applicant’s interest in the chosen life insurance policy and stating the sum they wish to insure (requirements vary by insurer but generally apply when the policyholder and beneficiary differ).

Depending on the type of insurance and the provider you choose, a minimum initial contribution may be required for policies with a savings or investment component. Pure protection policies typically do not require an initial contribution beyond the first premium.

Before applying for a policy, it is necessary to consider its terms and conditions carefully and consult a financial adviser to ensure the policy meets your cross-border coverage needs and is structured appropriately for your tax residency.

Portability and International Coverage for Expats

Many expats in Spain assume that once they purchase life insurance locally, the cover will remain valid regardless of where they live in the future. In practice, the portability of Spanish life insurance varies considerably between insurers, and understanding these differences is essential if you expect to move countries again or spend significant time outside Spain.

For some policies, cover is maintained as long as premiums are paid and you inform the insurer of your new address. Other providers restrict cover once you cease to be a Spanish resident or relocate to certain jurisdictions, particularly outside the EU or EEA or to countries where the insurer is not licensed or able to provide ongoing coverage.

In some cases, insurers may require additional underwriting, may increase premiums, or may decline to maintain the policy at all if your new country of residence is considered high-risk. These rules differ significantly between insurers, so expats should confirm portability in writing before taking out a policy.

The term “international coverage” can also be misleading. While some life insurance policies are designed to provide protection regardless of where you live or travel, others only extend cover for short periods abroad or may exclude deaths occurring in specific regions or high-risk countries (such as conflict zones or jurisdictions under sanctions).

For mobile expats, such as remote workers, contractors, or those who expect to retire elsewhere, these distinctions are critical.

If there is a realistic chance you may move again, it is important to clarify how your policy will operate outside Spain, which countries the insurer accepts as valid for continued cover, whether premiums can be paid from foreign bank accounts, and whether the insurer will continue to honour claims if you become resident in another jurisdiction.

In many cases, an international or globally portable policy may offer greater long-term security than a purely local Spanish contract because these products are specifically designed for mobility and multi-jurisdiction coverage.

A clear understanding of portability helps ensure that the policy you select remains effective throughout your time abroad, not just during your residence in Spain.

Application Timeline for Life Insurance as an Expat in Spain

Selecting and purchasing a life insurance policy as an expat in Spain involves the following steps:

1. Choosing an insurance provider: Compare and evaluate multiple insurance providers, focusing on reputable companies that offer local or international policies for expats and confirming whether they can provide cover based on your current and anticipated country of residence.
2. Obtaining life insurance quotes: Contact several providers and obtain quotes for the terms and coverage amount of the policy you are considering and check whether premiums differ based on residency, currency, or medical underwriting requirements.
3. Filling out the application form: When you choose the insurance company, complete the application form. Provide your information, such as your personal details, medical history, and proof of residency (NIE/TIE), along with any documentation required for foreign residents.
4. Completing the underwriting process: Once you submit the application form, the insurance company will assess your information and potentially request additional documents to align the policy’s structure to your risk profile. Depending on the insurer, this may include medical tests, financial questionnaires, or confirmation of your country of residence.
5. Reviewing the policy: When the provider approves the policy, you will receive the terms and conditions of the coverage. Evaluate this document carefully to ensure the policy aligns with your financial plan and that the policy remains valid if you relocate or spend extended periods outside Spain.
6. Paying the initial premium: If you agree with the policy’s terms and conditions, proceed to pay your first premiums and activate the policy. For policies with investment components, an initial contribution may also be required.

What To Avoid When Purchasing Life Insurance for Expats in Spain

Choosing or managing a life insurance policy inadequately can result in unnecessary fees and a potential negative impact on your long-term financial security. To protect your wealth as an expat in Spain, be mindful of the following issues:

1. Relying solely on local or employer policies
2. Underinsuring
3. Ignoring tax implications

Relying Solely on Local or Employer Policies

Relying on local or employer-provided life insurance policies in Spain may only be suitable for expats planning to settle in Spain permanently.

A local policy will rarely offer portability or international coverage. In case you repatriate or move countries, such policies won’t remain valid or may be restricted depending on the insurer’s licensing in your new country of residence.

Similarly, employer-provided life insurance policies are often inadequate for expats because they are tied to your employment in Spain, so your coverage will end once you leave your current employer.

Additionally, even if your employer policy is convertible to individual life insurance, these policies typically provide low coverage and may leave you underinsured and may not offer cross-border beneficiary payment options.

Underinsuring

Underinsuring refers to obtaining insufficient life insurance. This issue often arises when policyholders opt for a policy with lower monthly premiums.

Underinsured policies may expose your family to financial struggles in the event of your death as the payout may not be enough to cover their living expenses, mortgage, rent, education, and other financial obligations.

To ensure sufficient insurance for your beneficiaries while living in Spain, it’s advisable to:

• Calculate your family’s expenses, future goals, and outstanding debt.
• Work with a financial adviser to determine the appropriate amount of coverage required to meet your family’s financial needs.
• Review the policy regularly and, if possible, adjust the premiums based on significant life events, such as the birth of a child, marriage, and a substantial increase or decrease in income or changes to your country of residence.

Ignoring Tax Implications

Each country has unique laws regarding the taxation of life insurance payments and death benefits. Understanding the tax implications of life insurance payouts in Spain is crucial to ensure tax compliance and prevent unforeseen financial fluctuations.

Life insurance policies in Spain are subject to tax as follows:

If both Spain and your home country have the right to tax life insurance payouts, you may face double taxation. In this case, you may prevent paying taxes in both jurisdictions, provided the two countries entered a double tax treaty that covers the relevant type of tax.

Note that Spain’s treaties typically apply to income tax, not inheritance tax, so double exposure on death benefits may still occur.

Cross-Border Considerations for Expats Living in Spain

Many expats living in Spain have financial connections, assets, or family members in more than one country.

Because of this, life insurance planning often requires navigating multiple tax systems, different inheritance rules, and varying regulatory approaches between Spain and the expat’s home country or any country where beneficiaries reside.

Understanding how these jurisdictions interact is essential to avoid unexpected tax liabilities, delays in payouts, or complications for beneficiaries who live abroad.

Cross-border issues can affect:

• How death benefits are taxed.
• Which country considers the payout part of an estate.
• Whether beneficiaries face additional reporting requirements.
• How quickly and easily a claim can be processed.
• Whether a policy remains valid if you relocate again or change your tax residency.

For expats with truly international lives, these factors make it especially important to choose a policy that can operate smoothly across borders and that aligns with the tax and inheritance rules of both Spain and your home country as well as the jurisdictions relevant to your beneficiaries.

UK–Spain Considerations (For British Expats)

British expats living in Spain face a unique set of cross-border challenges because the UK and Spain apply different principles to taxation and inheritance.

Even after relocating to Spain, many British nationals continue to fall within the scope of the UK’s inheritance framework due to domicile rules, which can influence how life insurance payouts are treated and how an estate is assessed in both countries.

UK Domicile and Its Impact

The UK applies Inheritance Tax (IHT) based on domicile, not residence. This means UK expats may remain subject to UK IHT if:

• They retain a UK domicile
• They have not been outside the UK long enough to lose deemed-domicile status
• They maintain strong ties or own UK assets

As a result, a life insurance payout may fall under both the Spanish Inheritance and Gift Tax (ISD) and the UK IHT regime, depending on the expat’s circumstances and beneficiary locations and whether the policy is held inside or outside the taxable UK estate.

Comparison: How the UK and Spain Assess Life Insurance

Existing UK Life Insurance Policies

Life insurance taken out in the UK does not automatically adapt to Spanish residency. Depending on the insurer, you may be required to:

• Notify the provider of your move abroad
• Continue paying premiums from a UK account
• Comply with new restrictions based on your country of residence
• Undergo revised underwriting or face exclusions for long-term stays outside the UK

Some providers will continue to cover without issue; others may limit or cancel the policy once you become a non-resident. Coverage may also vary based on how long you remain outside the UK or if you move to a jurisdiction the insurer does not serve. Reviewing any UK policy when relocating to Spain is essential.

Buying Life Insurance While Living in Spain

For British expats taking out new cover in Spain or internationally, consider:

• Whether the insurer can pay claims to UK-based beneficiaries.
• Whether UK heirs face additional reporting or tax obligations.
• How currency conversion (GBP/EUR) may affect the value of the payout.
• Whether payments can be made into a UK bank account.

Cross-border claims often involve additional documentation or verification, especially when the policyholder or beneficiaries live in different jurisdictions or when the insurer operates in a different regulatory regime.

Why Cross-Border Advice Matters

Because UK domicile rules can apply long after leaving the UK, and Spain taxes residents on worldwide assets and certain life insurance payouts, the two systems frequently overlap.

Without appropriate cross-border financial planning, families may encounter:

• Unexpected tax liabilities
• Double taxation
• Delays in receiving benefits
• Administrative hurdles for beneficiaries living abroad

With proper structuring and international-aware planning, expats can ensure their life insurance works effectively across both systems and supports long-term financial and estate-planning goals while reducing the risk of avoidable tax exposure.