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Securing home insurance is crucial if you are buying a house in Portugal.
It helps protect and safeguard your valuable investment and ensures your belongings are protected – regardless of your mortgage situation. However, if you are buying a property for the first time, the policies and details of home insurance can get overwhelming.
Hence why, in this blog, we will guide you through the ins and outs of getting home insurance in Portugal.
Why is Home Insurance Portugal Important?
Generally, house insurance Portugal is considered a valuable investment when buying a property. It safeguards your home and belongings against unforeseen circumstances such as natural disasters, theft, and damage.
Moreover, in Portugal, it is legally required if you are purchasing a property under horizontal property ownership.
There is usually a high financial loss associated with property damage. With home insurance Portugal, you can sleep peacefully at night, knowing you and your family can recover and rebuild swiftly.
Given the high potential financial damage associated with property damage or loss, home insurance Portugal provides peace of mind, ensuring that individuals and families can swiftly recover and rebuild their homes and lives in the face of unexpected adversity.
Is Home Insurance Mandatory in Portugal?
Home insurance in Portugal may be mandatory depending on the type of property.
For properties located in buildings under horizontal ownership (condominiums), fire insurance (seguro de incêndio) is legally required. This insurance protects the building structure against fire-related damage.
In addition, if you purchase a property with a mortgage, Portuguese banks usually require property insurance as a condition of the loan.
If you are financing a home purchase, you can learn more about the process in our guide to mortgages in Portugal.
Even when insurance is not legally required, most property owners choose to obtain coverage to protect their property from unexpected damage.
A Quick Overview of Home Insurance Portugal
There are two primary types of home insurance policies that homeowners and property owners can opt for. These are designed to provide protection and financial security in various scenarios:
| Insurance Type | Coverage |
|---|---|
| Fire Insurance (Seguro de Incêndio) | Mandatory for properties in condominiums. Covers structural damage caused by fire and sometimes related risks. |
| Multi-Risk Insurance (Seguro Multirriscos) | Comprehensive policy covering fire, storms, floods, theft, liability, and property contents. |
Fire Insurance (Seguro de Incêndio)
Fire insurance, or “Seguro de Incêndio,” is the required insurance for property owners in Portugal. It is a basic plan that mainly covers damages directly caused by fires, including structural damages to the building.
This insecure can often also extend to cover other damaging incidents such as floods, electrical mishaps, storms, smoke, heat, storm, explosions, lightning, etc.
Multi-Risk Insurance (Seguro Multirriscos)
If you are aiming for a more comprehensive insurance policy, multi-risk or “Seguro Multirriscos” is the way to go.
This type of insurance offers a wider coverage, even allowing custom packages to each property owner’s needs.
The multi-risk insurance typically provides protection against a large variety of risks. Some examples include public liability, legal protection, contents coverage, earthquake protection, and even alternative accommodation expenses if need be.
Multi-risk insurance is usually recommended for cautious homeowners looking for an extra layer of security.
You can learn more about purchasing property in our guide to buying property in Portugal.
Companies That Offer Home Insurance Portugal
Fortunately, Portugal offers a large variety of home insurance companies for residents.
You can choose to purchase insurance directly from a local Portuguese insurance company or go for international providers with services in the country. Here’s a list of some popular insurance companies in Portugal:
Local Home Insurance Companies
International Home Insurance Providers
- MDS Expats
- Liberty
- Mapfre Portugal
- Allianz
How Much Does Home Insurance Portugal Cost?
There are several factors affecting the price of insurance. These can include location, coverage, property value, additional coverage, and claim history.
Normally, you can expect to pay for a basic home insurance policy (seguro de incêndio) starting at about €70 a year in Portugal. However, this can vary depending on the mentioned factors.
On the other hand, multi-risk policies usually cost more, starting at around €120 a year. Again, the actual price can vary depending on different factors.
| Policy Type | Average Annual Cost |
|---|---|
| Basic fire insurance | from €70 per year |
| Multi-risk insurance | from €120 per year |
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Home Insurance Portugal Coverage: Primary vs Vacation Home
Whether you own a residential home or a vacation house in Portugal, getting insurance is crucial to ensure the security of your property and assets.
However, there are certain details you need to keep in mind when you are purchasing a secondary residence (or a vacation home) that would remain empty for extended periods
For example, for vacation homes where you would stay for only a couple of weeks, insurance plans tend to be more costly. This is essentially due to the elevated risks of theft and vandalism for empty houses or those that lack regular surveillance.
Additionally, factors like the property’s size, the presence of outbuildings, and amenities like swimming pools can also influence the overall cost of your insurance premium.
If you plan to generate rental income, you can also explore our guide to renting out property in Portugal.
How To Choose Your Home Insurance Company In Portugal?
There are several key factors you need to consider before selecting your home insurance Portugal policy. This way, you can ensure to get the right coverage that best fits your needs.
1. Invest Time Before You Invest Money:
It’s crucial that you understand the different types of coverage offered by companies. These include fire insurance, multi-risk coverage, and even additional options like earthquake or flood insurance.
Take your time to determine which coverage would safeguard your house against potential damages specific to your environment.
2. Assess Your Property
Investing in insurance means investing in your financial security.
Hence, it’s important to assess the value of your house, including its contents and any valuable belongings. This will help you determine the accurate coverage amount as anything lower can lead to financial losses in the event of a claim.
3. Understand the Coverage Limits
A limit refers to the maximum amount any insurance company will pay for a covered loss.
Before you decide on any coverage, pay attention to the amount limit. Make sure the limits cover the value of your property and possessions.
4. Decide on a Suitable Deductible Amount
This is the portion you’ll need to pay out of your own pocket before the insurance coverage kicks in. While choosing a higher deductible can lower your premium (the amount you pay for the insurance policy itself), it can require you to pay more in case of a claim.
5. Read the Policy Properly
Do not skip any details while reviewing the policy, especially the policy exclusions. This helps you understand what events or circumstances are not covered. Be aware of any limitations, such as coverage for specific high-value items or damage caused by certain perils.
6. Research The Home Insurance Company
Research the insurance company’s reputation before signing up with them. Look for reliable reviews as you need a smooth and efficient claims process incase of any tragedy.
7. Look for Packages
Ask your handlers for any discounts that are available. These could include safety features, security systems, etc. You could also look for bundles that give you access to other insurance policies such as auto insurance.
Documents Required For Applying For A Home Insurance Portugal
You will need to provide some official documents and information to the company if you apply for a home insurance Portugal. These may include:
You will need to provide some official documents and information to the company if you apply for a home insurance Portugal. These may include:
Property Information
- Property address and description
- Property value or reconstruction value
- Property type (e.g., apartment, house)
Personal Information
- Your full name and contact information
- Date of birth
- Tax identification number (Número de Identificação Fiscal or NIF)
Ownership Documentation
- Proof of property ownership, such as a copy of the deed or purchase contract.
How We Can Help
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A single point of contact for your entire property purchase. From identifying the right property to coordinating agents, lawyers, and completing the purchase.
Independent Service
As an independent buyer’s agent, we work with any agent, seller, or developer, giving you access to the full market and helping you secure the right property at the best price.
Discover 10 Reasons to Choose Us for Buying Property in Portugal
Frequently Asked Questions
Is house insurance mandatory in Portugal?
Fire insurance is mandatory for properties located in condominium buildings. Other types of home insurance are optional but strongly recommended.
Do I need home insurance to get a mortgage in Portugal?
Yes. Most Portuguese banks require property insurance when financing a property purchase.
How much does home insurance cost in Portugal?
Basic policies start at around €70 per year, while multi-risk insurance typically starts around €120 annually depending on coverage.
Does home insurance cover earthquakes in Portugal?
Earthquake coverage is usually optional and must be added to the insurance policy.
Can foreigners obtain home insurance in Portugal?
Yes. Foreign property owners can easily obtain home insurance from both Portuguese and international insurers operating in Portugal.
Obtaining home insurance in Portugal is an important step for anyone who owns property in the country. Whether you are buying a home, renting out a property, or investing in real estate, insurance protects your property against unexpected damage and financial loss. While basic fire insurance may be legally required in certain cases, most homeowners prefer comprehensive multi-risk coverage to ensure their property and belongings are fully protected.
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