Mandatory Insurance for Alojamento Local: What the Law Requires and What to Check in Your Policy
published 28 September 2026
Insurance for an Alojamento Local (AL), Portugal's short-term rental regime, is not an optional extra: it is a condition for keeping your registration. Since 2024, the expiry date of your insurance is published in RNAL, the national short-term rental registry, and missing or invalid insurance is grounds for the municipality to cancel your registration. This guide explains what the law requires, based on the Alojamento Local technical guide published by Turismo de Portugal, and what to check before you sign a policy.
What the Law Requires
The mandatory insurance is set out in article 13-A of Decree-Law No. 128/2014 of 29 August, the legal regime for Alojamento Local, as introduced by Law No. 62/2018. The minimum conditions for that insurance were defined by Ordinance (Portaria) No. 248/2021 of 29 June.
In plain terms, the law requires:
- Third-party liability insurance (seguro de responsabilidade civil extracontratual) covering material and non-material damage caused to guests and third parties as a result of the accommodation activity.
- A minimum sum insured of €75,000 per claim, for each AL establishment.
- Fire cover, when the AL is in a building under horizontal property (a condominium-style building with separately owned units): the operator must take out, or prove the existence of, valid insurance covering material damage directly caused by a fire in, or starting in, the property.
The law adds a point many owners are unaware of: the operator is jointly liable with guests for damage guests cause to the building. If a guest damages common areas or a neighbour's flat, the condominium or the neighbour can hold the host responsible.
Liability Insurance Is Not Home Insurance
The two are often confused:
- Liability insurance covers damage your activity causes to other people: a guest who gets hurt, a leak that ruins the ceiling of the flat below.
- Home or multi-risk insurance (multirriscos) protects the property itself and its contents: fire, flooding, electrical damage, theft.
What the AL law requires, broadly, is the first, plus fire cover in buildings under horizontal property. A standard home policy may not cover a short-term rental activity at all, and even when it includes a liability element, that element may not meet the AL requirements. Do not assume your existing policy will do: ask the insurer for written confirmation.
What to Check in the Policy
Before you sign, or when you renew, read the policy with these points in mind:
- The activity is identified as Alojamento Local. The policy should explicitly mention AL operation, ideally with your registration number, not just "residential".
- Liability cover is at least €75,000 per claim, per establishment. If you run several units, confirm the amount applies to each.
- Guests are covered as third parties. Some home policies exclude harm to people using the property.
- Fire cover is in place if the AL is in a building under horizontal property, or you have proof that the building's insurance provides it.
- Exclusions make sense for your situation. Check what happens with damage guests cause on purpose, with parties, pets, pools or leisure equipment.
- Excesses. A high excess can make the policy useless for small claims, which are the most common.
- The expiry date. That is the date now shown in RNAL, and it is what the council will check.
For the exact minimum conditions required by law, check Ordinance No. 248/2021 and the information published by ASF, Portugal's insurance supervisor.
Mistakes That Leave Hosts Unprotected
- Letting the policy lapse without replacing it. If the insurance contract ends for any reason other than the end of the activity or the cancellation of the registration, the operator must notify the council through the Balcão Único Eletrónico (the government's online one-stop portal), together with the new policy, within 10 days. Otherwise the registration can be cancelled.
- Not having the policy to hand. The council can ask for proof of insurance at any time, and the host has at most three days to provide it.
- Under-declaring. A different number of beds or units, or a different use from the one declared, can be used by the insurer to refuse a claim.
- Not documenting the property's condition. Up-to-date photos and a record of check-ins and check-outs make a claim much easier.
Fines
Lacking liability insurance is a serious administrative offence (contraordenação grave) under Portugal's Legal Regime for Economic Administrative Offences. According to Turismo de Portugal's technical guide (January 2025), serious offences in Alojamento Local are punishable by fines of €650 to €1,500 for individuals and €1,700 to €24,000 for companies, with the limits depending on the size of the business. Additional sanctions may also apply, such as suspension of the activity or closure of the property for up to two years. On top of the fine, missing or invalid insurance is grounds for cancelling the registration.
Insurance Also Depends on Prevention
Insurance pays for damage; it does not prevent it. Most claims in short-term rentals start with something simple: a tap left running, a heater used the wrong way, a guest who could not find the fuse box. Clear house rules and practical instructions reduce that risk. See our house rules template in four languages.
How ciceroni Helps
ciceroni is not insurance and does not replace any policy. What it does is put the right information in front of guests before something goes wrong. Each stay gets its own digital guide, in Portuguese, English, French and Spanish, with the rules and instructions the host wrote: where the fuse box is, how the water heater works, what to do if there is a leak. An AI concierge answers questions on WhatsApp or in the guide, 24 hours a day, using only that information, and passes anything it does not know, or that needs a decision, to the host. ciceroni is free during launch.
FAQ
What is the minimum sum insured for AL insurance in Portugal?
€75,000 per claim, for each Alojamento Local establishment, for the third-party liability policy.
Is my home insurance enough?
Not necessarily. The law requires liability insurance covering damage to guests and third parties arising from the accommodation activity. A standard home policy may not cover that activity. Ask your insurer for written confirmation.
What happens if my insurance expires?
Missing or invalid insurance is grounds for the council to cancel your registration. If the contract ends, you must notify the council and upload the new policy through the Balcão Único Eletrónico within 10 days.
Do I need fire insurance?
If your AL is in a building under horizontal property, yes: you must have, or prove the existence of, valid insurance covering damage directly caused by a fire in, or starting in, the property.