Insurance in Portugal

Knowing which insurance policies you need when moving to Portugal can be a challenge for expats new the country. You need to know which ones are mandatory and work out if you want any additional coverage.

This article offers an introduction to Portuguese insurance for expats, with sections including:

Overview of insurance in Portugal

Portugal is a mid-ranking European country in terms of its insurance market. The industry was worth €11.6 billion in 2017 – a 6.5% increase on the previous year – with 73 insurance companies operating in Portugal.

The Insurance and Pension Funds Supervisory Authority (Autoridade de Supervisão de Seguros e Fundos de Pensões – ASF) regulates insurance companies in Portugal. Around 99% of companies have signed up to the Portuguese Association of Insurers (Associacao Portuguesa de Seguradores – APS).

You can see details of insurance companies in Portugal in our directory.

Which insurance is legally required in Portugal?

Health insurance

Portugal has a healthcare service, the Servico Nacional de Saude (SNS), which is similar to the UK National Health Service. All residents can access the service which is funded through social security payments.

Non-residents and short-term visitors will need to purchase private health insurance to access health treatment in Portugal. Residents with public health insurance can also take out additional private insurance. This enables them to cover costs not met through public funding and access a wider range of treatments.

Private health insurance companies operating in Portugal include:

• Allianz Care
• Cigna Global

You can read our guide to health insurance in Portugal to find out more information.

Car insurance

Portugal has similar car insurance options to many other European countries. By law, you must insure all roadworthy vehicles to at least a third-party level. In Portugal, it is the vehicle rather than the driver that is insured. This means that anyone with a license can legally drive an insured car.

Third-party car insurance (seguro obrigatório de responsabilidade civil automóvel) covers the costs of both material and personal damage to any third parties in the event of an accident. It is the cheapest form of vehicle insurance. However, this won’t cover costs relating to you or your own vehicle.

You can opt for additional coverage with third-party car insurance in Portugal. This includes damage caused by fire, floods, and natural disasters, as well as protection against theft.

The other type of vehicle insurance is fully comprehensive (seguro de danos próprios). This covers all costs to all parties. Some fully comp policies in Portugal have exclusions so you will need to check your policy carefully.

Policies come with a deductible – the excess amount you will have to pay if claiming on the insurance – and costs vary due to a number of factors, such as driver profile and vehicle value. For more information on this and more, read our guide to car insurance in Portugal.

Home insurance

Home insurance is mandatory in Portugal if you are taking out a Portuguese mortgage. It is not obligatory for rented accommodation in Portugal. However, landlords will be obliged to take out at least minimum level of insurance on the property and may well factor this into rental costs.

There are two types of building insurance on homes in Portugal:

• Fire insurance (seguro de incendio) – this is the minimum requirement for all homeowners and covers all parts of the property against damage caused by fire. Most fire insurance policies also include coverage against floods, storms, lightning damage and other natural disasters.
• Multi-risk insurance (seguro multirriscos) – this is an optional comprehensive coverage that includes things such as public liability.

You can also include contents insurance with many home insurance policies to protect your possessions as well as the property. Costs for home insurance in Portugal will depend on factors such as property value, level of coverage, and risks associated with the property. For more information, read our guide to home insurance in Portugal.

Social insurance

Portugal has a state-provided social security system where workers make mandatory contributions to cover them against things such as sickness, old age and unemployment. The following types of financial support are included through the system:

• Unemployment benefit
• Sickness benefit
• Maternity, paternity, and adoption leave
• Invalidity benefit
• Old age pension
• Survivor benefit

Enrollment in social insurance is compulsory for all employees but is usually arranged by the employer, who also makes contributions on your behalf. Those freelancing in Portugal need to make their own social security arrangements. Contribution levels and benefit entitlements are slightly different if you’re self-employed.

See our guide to social security in Portugal for more information.

Optional forms of insurance in Portugal

Life insurance

Life insurance is protection against the risks of death or disability. It ensures that your dependents are catered for in the event that you are no longer able to provide for them.

Although life insurance is not compulsory in Portugal, there are a number of providers in the country and many expats take out coverage. There are different policy types, including:

• Annual renewable term – where you recalculate the premium every year upon renewal, based on your age and health;
• Decreasing term – where the premium stays at a fixed amount for a set period of time.

Home contents insurance

You can add this to a general home insurance policy or take it out as a separate policy if you rent and don’t have home insurance. Contents insurance protects your movable possessions and equipment against damage, loss and theft.

Insuring the contents of your home can give you peace of mind, especially if you own a lot of valuable stuff. Premiums are usually not that high, especially when factored into an overall home insurance policy, although will obviously depend on the value of what you want insured.

Travel insurance

Travel insurance is an important consideration for those who frequently leave Portugal for either work or leisure purposes. If you apply for a Schengen visa, it becomes a requirement where you will need at least:

• Minimum medical coverage of €30,000
• Coverage of expenses related to repatriation on medical grounds.

You should shop around for travel insurance and make sure you find a policy that covers everything you need, such as trip cancellation, emergency evacuation and lost or damaged possessions. Check the small print for any exclusions, such as injuries due to sports or adventure activities.

Liability insurance

You will need public liability insurance if you are a businesses, landlord or vehicle owner in Portugal. It can also form part of a home insurance policy or you can take it out as a separate stand-alone policy to protect against the risk of causing damage or injury to another person or their property.

This type of insurance isn’t as common in Portugal as in some other countries. However, most insurance companies will have it as an option and premiums for basic coverage are not high.

Unemployment insurance

Some Portuguese insurance companies offer private unemployment insurance. Those who want a greater level of protection than that provided by the state scheme can take this out. Some banks and loan providers may also require this to be purchased as protection when you take out a large loan.

Holiday home insurance

Many people have holiday homes in Portugal. Because of this, there is a special form of home insurance available called holiday home insurance.

Holiday home insurance can include coverage relating to:

• loss of rental income following property damage or non-payment of rent by tenants;
• alternative accommodation costs;
• emergency travel costs if you need to suddenly visit your holiday home due to a problem;
• public liability;
• swimming pool cover

As with most other insurance types, costs will depend on various factors such as extent of coverage and property value.

Commercial insurance in Portugal

Expats starting a business in Portugal will need to take out insurances to protect them against the risks of running the business. There are insurances that are compulsory for all businesses, ones that are compulsory for certain types of business and others that are optional. The main business insurances include:

• public liability insurance – this is compulsory for all businesses. The insurance protects against claims from third parties resulting in damage, injury or financial loss. It can also extend to cover damages caused to someone’s reputation.
• building insurance – not compulsory for all businesses but usually a requirement if you need a loan or any sort of funding. Insures against property damage due to fire, flood or natural disasters. Can also include vandalism.
• equipment insurance – optional but recommended. Protects movable assets from damage and theft.
• employee insurance – if you have employees, you will need to enroll them in a social security scheme and make payments to cover them in the event of illness, accidents or parental leave. Companies can also have their own workplace schemes that offer a higher level of coverage.
• business interruption insurance – an optional type of insurance that protects against loss of income, including employee salaries, if the business has to cease trading for a period.

Many insurance companies offer package deals that combine insurance types, including those listed above. The best thing to do is to shop around and find a good value deal that is tailored to your specific business needs.

Useful resources

• Compare o Mercado – comparison site that allows you to compare different types of insurance deals as well as credit, energy and hotels.