Uninsured Drivers Surge Across Portugal, Pressuring the National Guarantee Fund

The number of drivers caught without mandatory car insurance in Portugal hit a new record in 2025, with 48,688 infractions recorded -- a 23 percent increase from the previous year. The surge is straining the country's Fundo de Garantia Automovel (Automobile Guarantee Fund), the public mechanism that compensates victims of accidents caused by uninsured or unidentified drivers.

The Scale of the Problem

Data reported by Jornal de Noticias reveals that claims filed with the Guarantee Fund rose by 9 percent in 2025 compared to the same period in 2024. The fund processed 4,873 cases and paid out 7.3 million euros in compensation to accident victims or the heirs of those killed in road incidents involving uninsured vehicles. For broader context, see our practical guide to Portuguese tolls and the Via Verde system in 2026.

Over the past five years, the fund has disbursed 33.9 million euros to cover damages caused by uninsured drivers or hit-and-run incidents where the vehicle was never identified. The trajectory is accelerating, with both the number of uninsured drivers and the frequency of accidents involving them climbing steadily.

Gabriel Bernardino, president of the ASF (Autoridade de Supervisao de Seguros e Fundos de Pensoes), Portugal's insurance and pension regulator, confirmed the trend in an interview with Antena1 and Jornal de Negocios. While the regulator said it does not yet have certainty about all the causes, the surge may be linked to the growth of home delivery services and certain professional categories where drivers operate vehicles without adequate coverage.

Why It Matters for All Drivers

The financial pressure on the Guarantee Fund does not exist in isolation. As Bernardino warned in comments reported by RTP Negocios, if the cost trajectory continues, it could make insurance premiums unaffordable for ordinary consumers. Insurers may also respond by reducing the scope of coverage they offer, leaving policyholders with less protection even when they pay for it.

This creates a vicious cycle: as premiums rise, more drivers may choose to skip insurance altogether, further increasing the burden on the Guarantee Fund and pushing costs higher still.

For law-abiding drivers, the risk is straightforward. If you are involved in an accident with an uninsured vehicle, the Guarantee Fund will cover your compensation -- but the process can be slower and more bureaucratic than a standard insurance claim. The fund's growing caseload means processing times may lengthen further.

The Legal Reality

Driving without third-party liability insurance (seguro de responsabilidade civil) is illegal in Portugal. The penalties are significant:

• Fines ranging from 500 to 2,500 euros for individuals
• Vehicle seizure (apreensao do veiculo) until valid insurance is presented
• Potential driving ban (inibicao de conducao)
• The uninsured driver remains personally liable for all damages caused, and the Guarantee Fund will pursue recovery of any compensation it pays out

Despite these penalties, enforcement has clearly not kept pace with the problem. The 23 percent year-on-year increase suggests that either economic pressure is driving more people to take the risk, or that certain segments of the driving population -- particularly in the gig economy -- are systematically operating outside the insurance framework.

What Expats and Foreign Residents Should Know

For anyone driving in Portugal, whether with Portuguese plates or a foreign-registered vehicle, there are several practical takeaways:

First, ensure your own insurance is comprehensive enough to cover uninsured motorist incidents. While third-party liability is the legal minimum, adding coverage for accidents involving uninsured drivers (cobertura contra danos proprios) provides an important safety net.

Second, if you are involved in an accident with an uninsured driver, report it immediately to your own insurer and to the PSP or GNR (police). You can file a claim directly with the Fundo de Garantia Automovel through the ASF website.

Third, be aware that foreign-registered vehicles in Portugal must also carry valid insurance recognized under the EU Green Card system. Driving with expired or invalid foreign insurance carries the same penalties as driving uninsured.

The surge in uninsured driving is a symptom of broader pressures on Portuguese households and the gig economy workforce. Until enforcement catches up or the economic incentives shift, the risk of encountering an uninsured driver on Portuguese roads will continue to rise -- making adequate personal coverage more important than ever.