If you have recently moved to the Canary Islands — or are planning to — you might assume that car insurance works exactly the same as on the Spanish mainland. In most respects it does, but there are several important differences that expats should understand before arranging their motor cover.
From different tax treatment to volcanic road surfaces, inter-island ferry considerations, and unique driving conditions, here is everything you need to know about car insurance in the Canary Islands.
The Canary Islands have their own indirect tax system. Instead of IVA (the Spanish equivalent of VAT), the islands use IGIC — Impuesto General Indirecto Canario. The standard IGIC rate is significantly lower than IVA, which can affect insurance premium calculations. While the net effect on your annual premium may be modest, it means that quotes from mainland-only comparison websites may not accurately reflect Canary Islands pricing. Always get a quote specifically for your island address.
The Canary Islands are volcanic, and this shapes the driving experience in ways that mainlanders never encounter. Road surfaces on secondary roads can be rougher than on the mainland, with loose volcanic gravel on bends. On islands like Lanzarote and Fuerteventura, sand drifts across roads are a regular hazard. On Tenerife and Gran Canaria, mountain roads feature extreme gradients, hairpin bends, and occasional rockfalls.
These conditions increase the risk of tyre damage, underbody scrapes, and single-vehicle accidents. A fully comprehensive policy (todo riesgo) is strongly recommended if you regularly drive on rural or mountain roads. Third-party-only cover leaves you fully exposed to the cost of repairing your own vehicle after a pothole or gravel incident.
The ITV (Inspección Técnica de Vehículos) — Spain's MOT equivalent — applies in the Canary Islands just as on the mainland. However, ITV stations on smaller islands can have longer waiting times for appointments. On Lanzarote and Fuerteventura, there are fewer stations, and during peak periods you may need to book several weeks in advance. An expired ITV certificate can compromise your insurance cover, so plan ahead.
The inspection itself checks the same items as on the mainland: brakes, emissions, lights, tyres, steering, and structural integrity. Vehicles used on rougher island roads may be more prone to failures on suspension and exhaust components.
Many Canary Islands residents travel between islands by ferry — Fred Olsen and Naviera Armas operate regular services. If you take your car on a ferry, you need to check whether your insurance policy covers maritime transit. Most comprehensive policies include this, but some third-party-only policies exclude it or require a separate endorsement.
Damage sustained during loading, unloading, or transit on the ferry is not always covered by the ferry company's own insurance, so having your own comprehensive motor policy is the safest approach. If you regularly ferry between Tenerife and Gran Canaria, or between Lanzarote and Fuerteventura, confirm this cover is included in your policy.
Speed limits in the Canary Islands follow the same legal framework as the mainland: 120 km/h on motorways, 90 km/h on conventional roads, 50 km/h in urban areas. However, many island roads have lower posted limits due to curves, gradients, and visibility issues. Radar cameras are common on the main motorways (TF-1, TF-5, GC-1), and mobile radar units operate on secondary roads.
Speeding fines can affect your insurance renewal premium. Spanish insurers increasingly check the DGT (traffic authority) database for penalty points, and a poor driving record can mean higher premiums or even refusal to renew.
A significant number of British expats have brought their UK-registered cars to the Canary Islands. The rules are the same as on the mainland: if you are a Spanish resident and your car has been on Spanish territory for more than six months, you must re-register it. Until you do, you need specialist insurance for foreign-plated vehicles — and not all insurers offer this.
We have extensive experience insuring UK-registered vehicles in the Canary Islands and can find you competitive cover while you work through the re-registration process.
Given the specific driving conditions in the Canary Islands, our recommendation for most expats is:
In all cases, roadside assistance (asistencia en carretera) is essential. Being stranded on a mountain road or in a remote area without recovery cover can be expensive and stressful.
Need car insurance in the Canary Islands? Get a free quote today — we compare policies from leading insurers and handle everything in English.
See also: Insurance in Tenerife | Insurance in Gran Canaria | Lanzarote & Fuerteventura Insurance Guide
