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How to choose the best car insurance in Portugal

Updated: Dec 26, 2023

Luso Insurance Agents  looks at some frequent questions on car insurance in Portugal


What risks are covered?


Car insurance policies include a wide range of covers.  Typically, insurers provide predefined coverage packages, to which it is possible to add additional cover. As a rule, the most basic modality includes mandatory liability, roadside assistance, legal protection and vehicle occupant coverage. In the intermediate modality, glass breakage and vehicle theft or robbery are added to the basic cover


Finally, the most complete modality (fully comprehensive) includes own-damage and natural phenomena.


Luso Insurance Agents can provide a quote that best suits you.  Start by selecting the modality that best suits you, taking into account the age of the vehicle, the level of coverage you want and the amount you are willing to pay for insurance. Luso Insurance Agents  will then tell you what each cover means.


Mandatory Civil Liability: Covers material and bodily damage unintentionally caused to third parties up to a limit of 7 million and 290 thousand euros per claim (6 million and 70 thousand euros for bodily damage and 1 million and 220 thousand euros for material damage), regardless of the number of victims.


Mandatory insurance coverage is established by law and is valid in the event of accidents occurring in Portugal and in other countries that are part of the Green Card system, and of which all European Union countries are part, in addition to Andorra, Croatia, Estonia , Ukraine, Iceland, Norway and Switzerland.


Optional civil liability: Covers damages caused to third parties that exceed the limits of mandatory civil liability insurance coverage. You can choose capital limits between 5 and 50 million euros.


Legal protection: Pays for the insured's defense against damage caused, or claims for compensation for damage suffered by the driver, occupants or the insured vehicle. It can be useful, the price is affordable and it can save you time.


Travel assistance: With a wide range of coverage, it includes assistance to the vehicle and its occupants and assistance to people in the event of a breakdown or accident. Valid in Europe and Mediterranean Basin countries, vehicle assistance covers, among others, emergency repairs, towing or repatriation of the vehicle and the accommodation or return expenses of its occupants.


In turn, assistance to people is valid worldwide, even if traveling without a vehicle, and guarantees medical assistance abroad, extension of stay, advance of funds or transport of injured people. These insurance policies have a relatively low cost and are very useful for resolving possible problems during a trip, which is why we recommend taking them out to all motorists.


Occupants: Guarantees the payment of compensation to all passengers of the injured vehicle, in the event of death or permanent disability, as well as treatment, repatriation or funeral expenses. It is interesting above all for the driver, as it is the only way to insure against these damages, since the remaining passengers are considered third parties and are already covered by civil liability insurance.

Isolated glass breakage: Covers the cost of replacing broken glass when the accident occurs with the vehicle stationary and the cause of the incident is not known. Damage to rear-view mirrors, headlights and taillights is excluded.


Own damage insurance: Covers damage suffered by the car, in the event of an accident for which the driver is responsible or when there is no third party involved. Typically includes coverage for fire, lightning and explosion, theft or robbery and shock (strike against a fixed object), collision (strike against a moving object) and rollover (change in the normal position of the vehicle).


Natural phenomena: Pays for repairs to damage to the vehicle caused by storms, floods, earthquakes, volcanic eruptions and landslides. It may be interesting for people who live in areas traditionally subject to flooding or similar phenomena.


Additionally, you can take out a range of other coverages whose interest depends on the characteristics of the vehicle and your particular situation. For example:

Replacement vehicle. Guarantees the provision of an alternative vehicle when the insured car is immobilized due to an accident or breakdown. This modality is generally expensive and has a 2 or 3 day allowance. Your interest decreases if you choose to place the car in an agreed workshop, thus having the right to a courtesy vehicle while the repair lasts;


Acts of vandalism: Guarantees payment for material damage resulting from strikes, riots, acts of terrorism or vandalism, and also for damage caused by authorities to control those events. It may be interesting for people who live in unsafe places, where disorders are frequent;


Where is it valid?


While mandatory civil liability insurance is valid in the countries included in the Green Card, optional insurance may have a restricted coverage to the national territory, depending on the policies (exception for coverage of travel assistance, occupants and legal protection, valid throughout the country). world).


What is the deductible?


The deductible is part of the damage repair that will always be borne by the insured. If the damage is less, the insurance company pays nothing. If they are higher, the insurer pays the compensation deducted from the deductible value.


Civil liability has no deductibles. Most personal injury policies impose a mandatory minimum deductible, which may be expressed as a percentage (for example, 2% of the sum insured) or in absolute value (for example, €400 euros). Collision and rollover coverage always has a deductible, but many policies do not apply in the event of theft or theft.

In addition to the mandatory deductible, it is possible to opt for higher deductibles in return for a reduction in the insurance premium.


Bonuses and aggravations


Insurers reduce the premium in proportion to the number of years without claims and increase it depending on reported accidents.

When transferring insurance to another company, they will apply the bonus or increase provided for in their own table, based on the accident history over the last 5 years. Through registration, insurers consult the Segurnet database, which contains the vehicle's accident history. For this reason, most insurers request registration information to provide a quote, so that the premium presented can reflect premium bonuses or increases associated with past accidents.


How is the price of insurance determined?


The price of civil liability depends on the type of vehicle (passenger car, goods car, etc.), its engine capacity class (up to 1,500, from 1,500 to 2,500, and over 2,500 cubic centimeters) and the sum insured.


In turn, the own damage insurance premium is defined according to the insured capital, which corresponds to the commercial value of the vehicle. This value decreases over the years and insurers are obliged to update it annually.


Additionally, there are other factors that can increase or decrease the premium, related to the characteristics of the driver or the vehicle itself - such as age and driving experience - residence or geographic area of circulation and the respective risk of accidents associated with it. Finally, factors such as where the vehicle is parked, the annual mileage or even the profession of the insured person may be used as a pricing factor and influence the premium, particularly in the case of direct insurers.


Submitted by Luso Insurance Agents

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