The Law 5/2025, of 24 July, modified the civil liability and insurance regime for motor vehicle circulation in Spain. One of its most relevant changes for companies was the expansion of the legal definition of “motor vehicle”, which may affect certain forklift trucks, self-propelled pallet trucks and industrial or agricultural machinery. The regulation was published in the BOE on 25 July 2025.
In 2026, there is one particularly important issue: the six-month transitional period provided for vehicles that became classified as motor vehicles has already ended. Therefore, companies must have reviewed which pieces of equipment in their fleet meet the legal definition and are subject to mandatory insurance.
However, it is not correct to claim that every wheelbarrow, pallet truck or agricultural machine automatically requires the same insurance simply due to the name of the equipment. The answer depends on your technical specifications and, to analyse the cover for a specific accident as a traffic incident, also regarding the function the vehicle was performing at that time.
What changed with Law 5/2025?
The reform broadened the definition of motor vehicle for the purposes of compulsory insurance and removed the previous regulatory restriction linking it to vehicles subject to administrative authorisation to be driven on the road. This makes it necessary to review equipment that could previously have fallen outside the compulsory regime even though they carried out their activity in warehouses, industrial plants, farms or private premises.
For companies with a large fleet of self-propelled equipment, this review must form part of a more comprehensive risk management and insurance for the industrial sector rial. PIB Group Iberia includes within this scope solutions relating to public liability, property damage, transit and machinery breakdown, amongst other risks, which are always subject to the conditions of each policy.
When is equipment considered a “motor vehicle”?
The Article 1 bis inserted by Law 5/2025 consider a motor vehicle to be, amongst other cases, a motor vehicle propelled exclusively by mechanical force, which travels on the ground, does not use a railway track and complies with one of these two alternatives:
- Having a maximum manufacturing speed exceeding 25 km/h; o
- To have a maximum net weight exceeding 25 kg and, at the same time, a maximum manufacturing speed of over 14 km/h.
Also included are the trailers and semi-trailers intended for use with the vehicles covered by the legal definition.
The second alternative requires both conditions together: more than 25 kg maximum net weight and more than 14 km/h maximum manufactured speed.
Therefore, a company should not classify its machinery solely by its trade name. It is advisable to review, at the very least:
- Technical specification;
- Manufacturer documentation;
- Maximum manufacturing speed;
- Maximum net weight;
- Propulsion system;
- Individual equipment identification.
withdrawal from circulation
This is one of the points that requires the most precision.
The law defines a traffic event as the use of a motor vehicle in accordance with its function as a means of transport at the time of the accident, independently:
- Of the vehicle's features;
- Depending on the terrain where it is used;
- Whether standing or moving.
Therefore, the fact that a team is within a industrial unit, warehouse, estate or private enclosure does not on its own preclude the application of the traffic regime.
However, the specific function performed must also be analysed. The explanatory memorandum itself explains that a use other than transport — for example, the use of the vehicle as a source of energy for industrial or agricultural purposes — may fall outside the scope of the concept of ‘use on the road’.
This distinction is important: It is one thing to determine whether the equipment meets the legal definition of a motor vehicle and another to analyse whether a specific accident constitutes a traffic event covered by compulsory insurance.
Do all fork-lift trucks need compulsory insurance?
“Yes” must not be answered automatically.
A forklift or fork truck must be assessed in accordance with the technical criteria set out in Law 5/2025. In practice, a vehicle will fall within the definition of a motor vehicle when, amongst other legal requirements, it meets the following:
- A maximum manufacturing speed exceeding 25 km/h; o
- A maximum net weight exceeding 25 kg along with a maximum manufacturing speed of over 14 km/h.
When a forklift truck meets the legal definition and has its habitual parking place in Spain, the scheme establishes the obligation to take out and maintain in force the corresponding insurance for each vehicle, except for the cases legally provided for.
Therefore, given the question “Is fork-lift truck insurance compulsory?”, the professional response is:
It depends on the technical specifications of the unit. The manufacturer's data must be checked and the obligation cannot be assumed solely because it is a forklift truck.
What happens if you only work inside a warehouse or private premises?
The fact of not going out onto the public highway does not in itself constitute an exclusion.
If the vehicle meets the legal definition, location in a warehouse, yard or private enclosure does not automatically eliminate the insurance obligation. Furthermore, an accident occurring while the vehicle is performing its transport function can be a traffic incident regardless of the terrain on which it is used.
This point particularly affects companies in logistics, manufacturing, distribution and warehousing that for years have managed certain fork-lift trucks exclusively as internal machinery.
Do electric pallet trucks need insurance?
Nor is there a single answer for all pallet jacks.
A electric or power-driven pallet truck it must be analysed using the same technical criteria. For example:
- If it exceeds maximum manufacturing speed of 25 km/h, you can enter the first legal option;
- It weighs more than 25 kg and exceeds maximum manufacturing speed of 14 km/h, you can enter the second one.
A pallet truck weighing over 25 kg that do not exceed 14 km/h It is not included in the second alternative solely because of its weight. Similarly, exceeding 14 km/h is not enough on its own for that alternative if the weight requirement is not also met, unless the equipment exceeds 25 km/h and the first one applies.
That is why we advise against applying general rules such as “Every electric pallet truck needs insurance” o “All slow-moving pallet trucks are exempt”. You need to check the specific equipment and also assess what other riales business coverages are available.
Compulsory insurance for industrial and construction machinery
Searches about compulsory insurance for industrial machinery rial raise the same issue: “industrial machinery rial” is not a homogeneous category for the purposes of Law 5/2025.
Equipment such as the following may require inspection:
- Loaders;
- Dumpers;
- Skid-steer loaders;
- Certain self-propelled machinery;
- Materials handling equipment;
- Mobile machinery used in industrial plants;
- Certain construction machines.
Inclusion must not be presumed from the team's name. The [criteria/requirements] must be checked technical criteria of Article 1 bis and the specific situation of the vehicle.
Backhoe loaders, loaders, dumpers and skid-steer loaders
In response to queries such as “Is retroexcavator insurance compulsory?” o “what insurance does a loader need?”, the correct procedure is to check:
- If the equipment is operated exclusively by mechanical power and travels along the ground;
- Its maximum manufacturing speed;
- Its maximum net weight;
- Your usual parking situation;
- Insurances already taken out;
- The effective use of equipment.
We do not recommend giving a definitive answer based solely on whether the machine is a backhoe, a dumper or a skid-steer loader.
Furthermore, compulsory motor insurance should not be confused with cover for the vehicle itself. Risks such as certain types of damage or breakdowns to equipment and machinery require consideration of other solutions, such as a business property insurance, always subject to the guarantees, limits and exclusions of the arranged policy.
What is happening to the agricultural machinery?
Law 5/2025 also makes it compulsory to inspect certain equipment used on agricultural holdings, but does not automatically convert every agricultural machine into a vehicle subject to the same regime simply because they belong to the sector.
In teams such as:
- Tractors;
- Combine harvesters;
- Self-propelled equipment;
- Certain mobile machinery;
- Other vehicles used in agricultural holdings;
It is necessary to check both the previous operating conditions and the technical specifications of each unit.
The analysis is of particular importance when the team:
- It moves around the holding;
- It travels along internal paths;
- It carries out transport functions;
- It can meet the legally prescribed weight and speed limits.
Companies and farms that need to review their risk more broadly can consult PIB Group Iberia's solutions for insurance for agricultural activities, which include, among other lines, motor and agricultural machinery insurance and agricultural public liability.
Since when has insurance been compulsory?
The Law 5/2025 is of 24 July 2025 and it was published in the BOE on 25 July 2025. The regulation established a transitional period of for vehicles that were not previously classified as motor vehicles but have since been reclassified as such: six months from the day following publication to take out the compulsory insurance.
That transition period has already ended. Once the adaptation period has ended, the resulting date is 26 January 2026.
During the transitional period, the law itself temporarily excluded the application of Article 3 to those vehicles. That temporary situation should no longer arise in 2026 as a “open ”grace period".
What penalties can there be for not insuring a vehicle that is required to be insured?
The article 3 of the consolidated text of the Law on Civil Liability and Insurance in the Circulation of Motor Vehicles considers consequences for failing to meet the insurance obligation, among them:
- Traffic ban of the uninsured vehicle;
- Vehicle impound in the legally prescribed terms;
- Fine of 601 to 3,005 euros, graduated taking into account factors such as whether or not the vehicle was being driven, its category, the service provided, the severity of the damage, the duration of the lack of insurance and repetition.
The exact amount it is neither automatic nor identical in all cases.
For this reason, a company with potentially affected equipment should not limit itself to checking whether “any policy” linked to the activity exists. It must review whether every vehicle subject to the requirement is properly insured.
Does the general commercial liability insurance of a company replace the compulsory insurance?
No. When a vehicle is legally subject to compulsory motor third-party liability insurance, a general liability policy must not automatically be considered as replacing that legal obligation.
These are areas that must be reviewed in a coordinated manner.
A company may need to analyse, among other issues:
- The compulsory insurance applicable to the vehicle;
- The civil liability arising from your activity;
- Possible exploitation risks;
- Third-party damage outside the scope of compulsory insurance;
- Damage sustained by its own assets;
- Limits, excesses and exclusions.
That is why it is advisable to jointly review the insurance programme and the public liability insurance for businesses, without assuming cover which will depend on the specific conditions contracted.
How to review a company's machinery fleet
To verify compliance with Law 5/2025, we propose a scheduled equipment audit.
1. Create a comprehensive inventory
Include:
- Forklifts;
- Mechanical bulls;
- Powered pallet trucks;
- Stackers;
- rial mobile industrial machinery;
- Plant and machinery;
- Agricultural machinery;
- Other mechanically propelled vehicles.
2. Collect the technical information
For each unit:
- Manufacturer;
- Model;
- Serial number or identification;
- Maximum net weight;
- Maximum manufacturing speed;
- Type of propulsion;
- Technical documentation available.
3. Apply the legal criteria
Check if:
- Overcome the 25 km/h; o
- Simultaneously overcomes the 25 kg and the 14 km/h.
4. Review existing insurance
It is not enough to identify a general policy. It is advisable to check:
- What vehicle is declared;
- What use has been communicated;
- What coverages are available;
- What exclusions apply;
- If there are differences between the operational reality and the assured information.
5. Coordinate the different policies
When a company manages multiple units, it may also make sense to review the organisation of the programme using solutions from vehicle fleet insurance, depending on the nature of the fleet and the applicable subscription criteria.
