Are you a PROJECT owner or CONTRACTOR? Pay attention to this insurance.

In Portugal, construction insurance refers to insurance taken out to cover risks associated with the execution of a civil construction or engineering project.

It is often known as “All Risks Construction Insurance” (or “All Risks Construction Insurance”), and is widely used in both public and private construction.

What is Construction Insurance?
This is a temporary insurance policy that covers material damage and accidents that may occur during the construction of a building, road, bridge, infrastructure, or other project. The objective is to protect the investment and ensure the continuity of the project, even in the event of unforeseen circumstances.

What does Construction Insurance cover?
Typical coverage may include:

Damage to the construction site itself:
Fire
Explosions
Falling of scaffolding or temporary structures
Flooding or storms
Construction errors
Theft or vandalism
Civil liability:
Damage caused to third parties during construction (e.g., materials falling onto neighboring properties)
Construction equipment and materials:
Damage to or theft of machinery, tools, and materials on the construction site
Personal accidents (optional):
Coverage for injured workers, although this is often purchased separately as occupational accident insurance (mandatory by law in Portugal).
Is it mandatory?
Yes and no. Occupational accident insurance is mandatory for all workers. Construction insurance (all risks) is not legally required, but:
It may be required by city councils, financing entities, or project owners
It is considered highly recommended, especially for large or complex projects
Duration
Valid from the start of the project until completion or handover
Can be extended to cover maintenance periods (e.g., defects after completion)