The mandatory alojamento local insurance
The operator (titular da exploração) of an alojamento local must take out and keep valid third-party civil liability insurance covering property and non-property damage caused to guests and third parties as a result of the activity (article 13-A of Decree-Law 128/2014, which regulates alojamento local, in the wording in force).
The minimum conditions of this insurance are set by Ordinance (Portaria) 248/2021:
- Minimum of 75,000 euros per claim, for each establishment registered in the National Alojamento Local Register (RNAL).
- The excess cannot be held against injured parties: the insurer pays the guest or third party in full and can then recover the excess from the operator.
The insurance belongs to the operator, who may not be the owner: anyone running an alojamento local in a rented or lent property needs their own policy.
Without valid insurance, the registration can be cancelled
Not having valid insurance is grounds for cancelling the alojamento local registration. In practice, the risk lies in the renewal: an unpaid premium or a lapsed policy leaves the establishment without the required cover. Set up direct debit for the premium and keep the policy and receipt up to date: they are the proof to show when the municipality or inspectors ask for it. Check with the municipality where you are registered whether it requires proof to be sent, and how.
In a condominium building
In a flat, the fire insurance for the unit, mandatory for every owner in the building (Civil Code, article 1429), is added to the civil liability insurance. The alojamento local law also makes the operator jointly liable with guests for damage they cause to the building. Check that your policy covers that damage in the common parts.
The legal minimum does not protect your property
The mandatory insurance pays for damage caused to others. To protect the property and the business, consider:
- Building and contents multi-risk declared for tourist use. An ordinary home policy is designed for a household; a rotation of guests is a different risk. Declare the activity to the insurer: not doing so can lead to a claim being refused.
- Damage caused by guests to the contents, and theft by guests, which many home policies exclude.
- Loss of income: bookings lost while the property is closed after a covered claim.
- Workers' compensation, if you have staff, even part-time, for example for cleaning: workers' compensation insurance is mandatory for employers (Law 98/2009).
- 24-hour assistance: plumber, electrician or locksmith between two bookings.
Compare the general and special conditions and the exclusions, not just the premium. Some insurers have dedicated alojamento local products that bundle the legal minimum with these covers.
Short-term or long-term rental?
Short-term rental earns more per night but costs more: cleaning, platforms, insurance, licensing and empty periods. Before deciding, compare both models in the rental yield simulator. For a long-term rental, the landlord's insurance is different: see landlord home insurance.
Informational, not legal or insurance advice. Aluseg does not sell insurance. Sources: Decree-Law 128/2014 (article 13-A), Ordinance 248/2021, Civil Code (article 1429), Law 98/2009. The alojamento local regime has been amended several times: check the wording in force and your municipality's regulations.