Historically, the insured’s obligation to keep the insured property in good condition, along with the pre-contractual duty of disclosure of the true extent of the risk, was regulated in the Code of Commerce. Under the Code, insurers had the ability to decline claims more easily as even innocent missrepresentations gave insurers a defence to coverage.

Nowadays the Insurance Contract Act states the insured’s duty to notify the insurer of any changes that affect the risk such as those that arise from lack of proper maintenance. Conflicts arise when a claim is made and the insurers' appointed experts or adjusters reveal that the condition of the risk changed after inception and the insured failed to report such change to the insurers.

The existing caselaw is pro-insured as the onus of proof is on insurers to establish that the insured failed to keep the property in the same or better condition that was reported before inception. Expert and adjusters' reports become crucial in such circumstances. When addressing lack of maintenance disputes, the courts have based their rulings on the insured’s obligation to disclose the true extent of the risk at inception which is not necessarily the same as the duty to maintain the risk properly albeit both are related.

The case law produced by the appellate courts and shared by the Supreme Court is to the effect that the lack of maintenance by the insured must be made in bad faith or resultant from wilful misconduct to allow coverage to be rejected. This is extremely difficult to prove before the courts, albeit a focused investigation in this area, yielding positive results for insurers, can be used in negotiation to reduce the insured's expectations.

There is an added difficulty for insurers to reject coverage on lack of maintenance grounds. Part of the judiciary considers that any exclusion based on lack of maintenance is a limitative clause, thus, it needs to be specifically agreed by the insured in the policy contract. Unfortunately there are many policies that are issued without documented proof of the insured’s agreement, which is best achieved by having the insured sign on each page of the policy.

Applying proportional underinsurance rules is allowed by the Insurance Contract Act, however, the parties may agree to waive the application of the average rule. The burden of proving whether the property was underinsured falls on the insurer.

If in the normal course of business and before a claim is made, the insurers detect any modification of the circumstances affecting the risk, regardless of whether the insured had anything to do with the change, insurers can terminate the contract by serving written notice on the insured within one month of discovery. Alternatively, insurers may propose new terms to the insured to continue with the contract, by serving notice within two months. Insurers are entitled to keep the premium related to the period before the alteration in the risk was discovered. Should a loss take place before insurers find out about the lack of maintenance or other conditions worsening the risk as declared, the indemnity due to the insured would be proportional to the difference between the premium paid and that premium the insured would have been asked to pay had the true entity of the risk been known at inception. Insurers are entitled to rescind the policy only if the insured acte d in bad faith.

In the case of special risks as defined in the Insurance Contract Act, usually in connection with high quantum projects or extraordinary insurance lines, the parties are allowed to choose the law applicable to the resolution of disputes. However, most policies subsidiarily apply Spanish law in any event.