Portugal prepares condominium management reform and insurance review

The Portuguese government is preparing a new legal regime for the management and administration of condominiums. This reform aims to increase the qualification, supervision, and accountability of sector operators to enhance transparency and protect real estate assets.

While the reform focuses on administrators rather than the legal regime of buildings, it has sparked debate regarding the adequacy of current insurance models. Experts note that modern residential buildings manage increasingly complex technical infrastructures, including security systems and elevators, which present new risks.

Data indicates a significant protection gap in Portugal; between 1980 and 2020, 96% of economic losses from natural disasters were uninsured, compared to a 78% average in the European Union. In condominium settings, the lack of coverage for a single unit can jeopardize the entire building, particularly in cases of seismic events or extreme weather. There are calls to make storm and seismic coverage mandatory, similar to fire insurance, to address the risks posed by an aging building stock and increasing meteorological volatility.