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customer support

9am to 12.45pm 1.45pm to 5.30pm saturday – closed

252 317 440

Calls to national fixed networks according to the conditions of your tariff.

Most houses in Portugal are not insured against earthquakes

Four out of five houses in Portugal are not insured against earthquakes, which can cause losses for individuals and the state.

Only 19% to 20% of Portuguese homes are covered for seismic risk, which means that only one in five homes is insured to cover damage caused by earthquakes. The indication comes from the Insurance and Pension Funds Supervisory Authority (ASF), which released the Financial Stability Report for the Insurance and Pension Funds Sector for December 2022.

According to the data provided, this insufficient coverage, in addition to causing the reconstruction of the property and the payment of the mortgage to result in major losses, calls into question Portugal’s ability to recover from a catastrophe. However, the regions with the highest national seismic risk, such as Algarve, Lisbon, Vale do Tejo and Porto, are also the regions in which insurers concentrate the most insurance capital in the housing segment with cover for this type of phenomenon.

According to ASF, if an earthquake occurs and there is no insurance cover, “the probable loss of income for individuals, combined with the need to reconcile the financing of the reconstruction of the property and the payment of the mortgage, could lead to high losses, with direct contagion to the financial sector”. Given that homes lose value when they are damaged, customers end up “letting go” of a loan on a house that has fallen in value. As a result, this catastrophe can lead to the need for “state intervention”, which “puts pressure on the country’s perception of credit risk”.

If the insurance company provides cover, the losses are compensated and, in turn, the state is no longer under so much pressure when it comes to post-disaster recovery. With this in mind, ASF has organized a number of initiatives related to the creation of a national system of protection against the risk of seismic phenomena, including a seismic fund.

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