This article explains travel insurance to Portugal. The insurance you get for traveling must work in all the countries you will visit and cover you for the whole time you are there. It should be valid for the length of your stay and not the duration of your visa. The Insurance must pay for medical costs, if you need to go back home for medical reasons or if you have an emergency in a hospital. It has to give you at least 30,000 Euros of coverage.
Exceptions to the insurance requirement include:
Holders of diplomatic passports.
Family members of citizens from EU Member States or Switzerland.
Applicants for airport transit visas.
Certain professional categories, like maritime professions, may also be exempt from the insurance requirement if they are already covered by the necessary professional insurance.