PORTUGAL Trends and Developments Contributed by: Carla Azevedo Gomes, Pedro Malta da Silveira, Miguel Duarte Santos and Camila Cândido, SPS-Barrilero
Consolidation and specialisation Market concentration has also been reinforced through gradual and often discreet consolidation mechanisms, including: • portfolio transfers; • withdrawal from less profitable lines of business. Although 2025 did not witness a high volume of high- profile M&A transactions, there has been a clear trend towards functional consolidation, with leading groups strengthening their market positions and smaller play- ers reducing their operational footprint. • intra-group restructurings; • brand rationalisation; and Smaller insurers increasingly focus on niche or spe- cialised segments, while leading players concentrate on strengthening their market positions. Competition considerations Market concentration produces mixed effects. On the one hand, it may enhance: • financial stability; • capacity to absorb systemic shocks (including climate, cyber and health-related risks); and • investment in compliance and innovation. On the other hand, it raises concerns relating to: • reduced competitive pressure in certain segments; • limited product diversity; and • potential standardisation of pricing and contractual terms. As a result, market concentration remains an area of ongoing interest for supervisory and competition authorities which seek to balance prudential stability with effective competition and consumer protection. Summarising analysis The current Portuguese insurance market reflects a mature, resilient and increasingly sophisticated sec- tor, operating within a markedly more complex legal, regulatory and operational environment. The trends identified throughout this article – sustainable pre- mium growth, accelerated digitalisation, heightened
regulatory scrutiny, emerging systemic risks, intense sectoral debate and continued market concentration – are not isolated phenomena. Rather, they are intercon- nected dimensions of a broader transformation that is reshaping the role of insurance in the Portuguese economy. From a legal and regulatory perspective, 2025 con- firms a decisive shift towards preventive, governance- driven regulation, particularly in areas related to tech- nology, operational resilience and risk management. The implementation of DORA illustrates this evolution clearly, imposing obligations that extend beyond for- mal compliance and require demonstrable effective- ness, accountability and board-level engagement. Insurers must now evidence not only that policies and procedures exist, but that they function in practice and are embedded within organisational culture and decision-making processes. At the same time, the acceleration of digitalisation continues to blur traditional boundaries between legal, compliance, risk and IT functions. Technological inno- vation – including automation, advanced analytics and artificial intelligence – offers significant opportunities for efficiency and improved customer experience but also introduces new legal risks. These include issues of data protection, algorithmic governance, outsourc- ing and liability allocation, all of which require careful contractual structuring and ongoing oversight. As a result, legal advice in the insurance sector increas- ingly demands a multidisciplinary approach, combin- ing regulatory expertise with technological and opera- tional understanding. Emerging risks further reinforce the need for this integrated perspective. Climate risk, cyber risk and health-related risk are no longer peripheral considera- tions, but central elements of insurers’ strategic plan- ning, underwriting and capital management. Each of these risks presents distinct legal challenges: climate risk raises questions around disclosure, solvency and long-term sustainability; cyber risk tests the adequacy of contractual protections, incident response frame- works and regulatory reporting mechanisms; and health risk places pressure on product design, pricing and consumer protection obligations. In this context, insurers must navigate a dynamic and evolving regula-
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