Car insurance in Portugal operates similarly to many other countries. One key aspect to note is that a minimum coverage of third-party insurance is mandatory, as it is in many nations. This coverage ensures that you are financially protected in case you cause damage to someone else’s vehicle or property while driving.

However, you have the option to enhance your coverage by choosing additional policies that can protect you and your own vehicle. These policies can cover various risks, such as theft, fire, and accidents.

If you are coming from a European Union (EU) or European Free Trade Association (EFTA) country, you can often use your existing insurance when driving in Portugal. This is thanks to the principles of free movement and insurance coverage within the EU and EFTA, which allow for the recognition of insurance policies across member states.

Types of car insurance in Portugal

Third-Party Car Insurance 

In Portuguese “Seguro de Responsabilidade Civil Automóvel”. This is the minimum legal requirement for car insurance in Portugal. It covers the damage you might cause to other people’s vehicles or property in an accident. Third-party insurance is mandatory and ensures that you are financially responsible for any harm caused to others while driving. However, it does not cover damage to your own vehicle.

Fully Comprehensive Car Insurance

In Portuguese “Seguro Contra Todos os Riscos ou Cobertura Total”. This type of insurance provides more extensive coverage. It includes the protection offered by third-party insurance but also covers damage to your own vehicle. Fully comprehensive insurance can include various additional features such as coverage for theft, fire, vandalism, and accidents. It provides more comprehensive protection but comes at a higher cost compared to third-party insurance.

man driving a car

Car insurance companies in Portugal

Portugal has several car insurance companies that offer a range of insurance products, including car insurance. Here are some well-known car insurance companies in Portugal:

Allianz Portugal: Allianz is a global insurance company with a strong presence in Portugal. They offer various insurance products, including car insurance.

Fidelidade: Fidelidade is one of the largest insurance companies in Portugal, offering a wide range of insurance options, including car insurance.

Liberty Seguros: Liberty Seguros is another prominent insurance provider in Portugal, offering comprehensive car insurance coverage.

Ageas Seguros: Ageas Seguros is known for providing insurance solutions in Portugal, including car insurance policies.

N Seguros: N Seguros is a Portuguese insurance company offering various insurance products, including car insurance.

Zurich Seguros: Zurich Seguros is part of the Zurich Insurance Group and offers car insurance coverage in Portugal.

Tranquilidade: Tranquilidade is a well-established insurance company in Portugal that offers car insurance among its services.

underground car parking in Portugal

Car insurance costs in Portugal

The cost of car insurance can vary significantly based on a variety of factors, including your location, driving history, the type of coverage you choose, and the insurance company you select. 

Third-party insurance typically begins at approximately €150 annually, while fully comprehensive coverage starts at around €350 per year. Nevertheless, your actual premium is likely to be significantly higher, depending on the market value of your vehicle.

Here are some of the key factors that can impact car insurance costs in Portugal:

Driver’s Age: Younger, less experienced drivers typically pay higher insurance premiums, as they are considered higher risk.

Driving History: A clean driving record with no accidents or traffic violations can lead to lower insurance premiums, while a history of accidents or violations may result in higher costs.

Type of Coverage: The type of coverage you choose plays a significant role. Basic third-party liability insurance is typically less expensive than comprehensive coverage that includes protection for your own vehicle.

Vehicle Type: The make and model of your car, as well as its age and value, can affect insurance costs. More expensive or high-performance vehicles often have higher insurance premiums.

Location: Where you live and park your car can influence costs. Urban areas with higher rates of accidents and thefts may have higher insurance premiums than rural areas.

Allianz insurance company

What to consider before choosing a car insurance?

Choosing the right car insurance is an important decision that requires careful consideration. Here are several factors to think about before selecting a car insurance policy:

Coverage Needs: Determine what type of coverage you need. Consider options like liability, collision, comprehensive, personal injury protection, and uninsured/underinsured motorist coverage based on your circumstances.

Budget: Set a budget for your insurance premium. Be realistic about what you can afford while still obtaining adequate coverage.

Deductible: Decide on a deductible amount that you’re comfortable with. A higher deductible can lower your premium, but be prepared to pay more out of pocket in case of a claim.

Customer Service: Research the reputation of the insurance company for customer service and claims handling. Reviews and ratings can provide insights.

Policy Terms: Understand the terms and conditions of the policy, including renewal procedures, cancellation policies, and any waiting periods for coverage to take effect.

Coverage Exclusions: Be aware of coverage exclusions and limitations, such as specific circumstances not covered by the policy.

Comparison Shopping: Get quotes from multiple insurance providers to compare rates, coverage options, and discounts. Online comparison tools can be helpful.

car traffic

How to apply for a car insurance in Portugal?

When applying for a car insurance in Portugal, you will typically need to provide several documents and meet certain requirements. Here’s a checklist of what you should have in order to purchase car insurance in Portugal:

Valid Driving License: You must have a valid driving license to purchase car insurance in Portugal. Make sure your license is up to date and valid for the type of vehicle you intend to insure.

ID or Passport: You’ll need to provide proof of your identity, which can be your national identity card (if applicable) or your passport. This is a standard requirement for most transactions in Portugal.

Tax Identification Number (NIF): You’ll need a Portuguese tax identification number (NIF) to purchase car insurance. This number is used for various financial and administrative transactions in Portugal, including insurance.

Vehicle registration: You will need the necessary documents related to the vehicle you want to insure. These typically include the vehicle’s registration certificate (Certificado de Matrícula) and proof of ownership.

Inspection Certificate: In Portugal, vehicles are required to undergo periodic inspections. You may need to provide the inspection certification (Certificado de Inspeção) to show that your vehicle has passed the necessary safety and emissions inspections.

apply for car insurance

How to make a complaint about a car insurance company in Portugal?

If you encounter issues with your car insurance company in Portugal and need to make a complaint you should begin by reaching out to the customer service department of your car insurance company. They are your first point of contact for resolving complaints. Explain the nature of your issue clearly and provide all relevant details. This initial step often resolves many problems.

Before contacting customer service, gather all pertinent information and documentation related to your complaint. This may include your policy details, any correspondence, photos, or other evidence that supports your case.

If you’re not satisfied with the resolution provided by customer service or if your complaint remains unresolved, you have the option to escalate the matter. In Portugal, you can contact the regulatory authority for insurance matters, known as the “Autoridade de Supervisão de Seguros e Fundos de Pensões” (ASF)

Traffic Accident Claim in Portugal

In Portugal, every driver is legally required to possess a minimum of third-party insurance coverage. In the case of a minor accident, the individuals involved should exchange information and fulfill the incident report that is later submitted to the insurance companies. If there is a disagreement between the parties involved, it’s advisable not to sign any documents.

The insurance document, typically found in the policy wallet, known as a DAAA or Declaração Amigável (Friendly Agreement), is a simple form. It is filled out and signed by both parties involved in the accident and then submitted to their respective insurance providers. However, in cases where there is no agreement, the Folheto Participação de Sinistro (Non-Friendly Accident Claim Form) should be completed and sent to the insurer.

The quicker you provide this information to your agent, the more effective their assistance will be in handling your claim.

road car accident

Frequently asked questions about Car Insurance in Portugal

How much is car insurance in Portugal?

A third-party car insurance starts at just €150, while a fully comprehensive car insurance can range from €350.

Can I use my foreign car insurance in Portugal?

You have the option to utilize car insurance from EU countries when driving in Portugal. Additionally, insurance from nations affiliated with the Green Card Bureaux, such as the United Kingdom, is also valid for use in Portugal.

Can anyone drive an insured car in Portugal?

After securing insurance for your vehicle to drive on Portuguese roads, anyone possessing a valid, unblemished driving license is legally permitted to use the car for this purpose.

What is the penalty for driving with no insurance in Portugal?

The penalty for driving without insurance in Portugal may range from 500 to 2000 Euros. Additionally, given the severity of this offense in Portugal, a driver operating a vehicle without insurance may face a deduction of two points from their driving license.

What type of insurance is required to rent a car in Portugal?

In Portugal, the law mandates that drivers must have comprehensive liability insurance, and this insurance is automatically included in the cost of all car rentals.