Car insurance in Luxembourg

The compact nature of Luxembourg makes it easy for even the newest arrivals to get around, with a unique public transport system and a good road network. However, if you’re getting behind the wheel in Luxembourg, you’ll need vehicle insurance. This is one of the mandatory types of insurance in Luxembourg and you’ll need at least basic coverage if you drive in the country.

This guide to car insurance in Luxembourg explains all you need to know when considering taking out a policy, with sections on:

Car insurance in Luxembourg

Car insurance in Luxembourg is compulsory at a minimum third-party level for all residents who drive and own vehicles. It is the fifth-largest non-life insurance segment in Luxembourg, accounting for 8.8% of the market in terms of written premiums.

You can choose to insure your vehicle with any of several national or international companies operating in Luxembourg. It is the car rather than the driver that is insured, meaning that anyone with a valid driving license can drive your car. However, you will need to take out additional coverage to drive other vehicles and will need to amend your policy if you change cars.

The Commissariat aux Assurances (CAA) regulates all forms of insurance in Luxembourg, including car insurance.

Can you use car insurance from another country in Luxembourg?

Drivers from other EU/EFTA countries can use their insurance green card to cover them in Luxembourg with insurance from their own country. Similarly, Luxembourg drivers can use their car insurance across the EU/EFTA, making it easy to go on a spontaneous road trip over the border.

However, if you move to Luxembourg from outside the EU/EFTA, you will have to take out a new policy unless your existing one specifies that you have coverage in overseas countries including Luxembourg.

Types of car insurance in Luxembourg

Insurance companies in Luxembourg offer different coverage levels. There are three common types, although some insurers may have additional packages.

Third-party liability (responsabilite civile)

Also known as civil liability insurance. This is the minimum required level for all motor vehicles. You will need this in place before you can register a car in Luxembourg. Liability insurance covers damage and injury to all third parties and their property in accidents where you are at fault. However, it doesn’t cover any costs concerning yourself, your vehicle, or your property.

Extended insurance (tiers personnes)

This is essentially third-party liability plus partial coverage on your own vehicle. Typically it will include costs arising from most incidents that are not your fault, including fire, theft, vandalism, and damage caused by natural disasters. This mid-level coverage is often quite extensive in Luxembourg and can include things such as glass breakage and legal protection. Packages vary from insurer to insurer, so it’s wise to shop around.

Comprehensive (assurance casco)

The highest level that companies provide, which covers pretty much everything even when the incident is your fault. Needless to say, this is the most expensive kind of car insurance in Luxembourg. However, there are limitations even on this type of policy. For example, deliberate damage is usually excluded. There will also be limits on things such as total value of belongings protected or how long the insurer will pay for a replacement vehicle.

Insurance costs

Costs of these policies vary considerably based on a number of factors. These include:

• The make, model, age, and condition of your vehicle
• Your driver profile, including your age and your claims history
• Where you live
• What you use your car for (e.g., leisure, commuting, business)

For example, for a mid-range car less than five years old, you can expect to pay around €500 per year for third-party insurance, €750 for extended and €1,500 for comprehensive. This is based on you having a reasonable claims profile and insuring the car for personal use. Many insurers in Luxembourg don’t charge a deductible (the amount you have to pay towards costs on your first claim), especially with comprehensive policies. However, you can ask for this to be included to lower your premium.

Most companies have a cost calculator on their website, such as this one from Bâloise.

Additional forms of car insurance in Luxembourg

You can often buy additional coverage to top up non-comprehensive forms of insurance. Each company offers different products but they typically include things like:

• Breakdown assistance – this is rarely included unless you have fully comprehensive insurance. It covers the likes of repair and replacement transport in the event of your car breaking down.
• Medical costs – this can include costs for you and those traveling in your car. It is worth having if you don’t have personal accident insurance and your health insurance is limited.
• Overseas coverage – this can cover you if you take your car outside the EU.
• Legal protection – this is sometimes included in basic policies but not always. It covers legal costs in the event of a claim going to court.
• Replacement vehicle – if your vehicle is a write-off or will be off the road for a long time, this can cover the costs of purchasing or hiring a replacement.

Car insurance bonuses and penalties in Luxembourg

Luxembourg has a no-claims bonus system known as bonus malus. This is similar to many other countries where you can earn annual discounts for every year that you don’t make a claim. The system is quite generous in Luxembourg as you can accumulate discounts over thirteen years (some countries stop at five) and get a maximum discount of 55%.

You can also transfer no claims periods from other countries to boost your bonus malus score. Make sure that you get a letter or official documentation from your previous insurer if you haven’t made a claim.

Although you can get discounts for claims-free periods, you can also expect your premiums to increase if you have a poor driving record. You are likely to be charged a higher premium rate if you have a history of insurance claims, points on your driving license, or are a young or inexperienced driver.

Car insurance companies in Luxembourg

There are a number of insurance companies in Luxembourg that offer auto insurance. Some of these are international companies, while others specialize in the Luxembourg market. Insurance companies offering vehicle cover in Luxembourg include:

• Allianz
• AXA
• Bâloise
• Foyer
• LaLux

Check deals with both national and international providers on comparison sites such as TopAssur.

How to choose car insurance in Luxembourg

When shopping for car insurance in Luxembourg, be sure to consider all the different factors to find the deal that’s right for you. Things you may want to think about include:

• What the company offers in terms of a no-claims bonus or other discounts.
• Whether you can tailor policies to include extras that you want and remove anything not needed.
• How easy is their claims process? Can you do it online? How quickly do they pay and how much will they pay?
• Company reputation. Check customer feedback and online reviews.
• Can you choose to pay a deductible to lower your premium?
• How well the company performs in terms of sustainability, ethics, and corporate social responsibility (CSR). You can check if the company is rated on CSR Hub or Standard Ethics.

How to apply for car insurance in Luxembourg

With most insurers, you can choose to take out a policy online or speak to your nearest agent. If you apply online, typically you will fill out the online quote form where you give details about yourself, your vehicle, and the type of cover you want. You will then receive your quote and can take out the policy.

Expect to provide details of your driving license and bank account as a minimum. Some companies may ask for additional information on your car or your residency status. As you need insurance to register a vehicle in Luxembourg, you won’t be asked for registration details unless you’re changing insurers.

Once covered, you should receive your insurance policy with a unique number, European accident report form, and green card documents which you can use as proof of insurance across the EU/EFTA and other countries that are part of the green card system.

How to make a car insurance claim in Luxembourg

You can file an insurance claim with most companies either online, by phone, or in-person if they have offices nearby. Many firms now allow you to complete an online claim form (see this example form from AXA) where you give details about yourself and your claim.

In the event of an accident, you should complete your European accident report form (which you’ll need to send to your insurer) and call emergency services if the accident is serious. Take photos of any damage and record witness statements if necessary.

You should file your claim as soon as possible after the accident. Companies may impose their own deadlines for making a claim, after which you may need a good reason for claiming late. The legal deadline for raising an insurance claim in Luxembourg is three years after the event.

Canceling a contract or changing provider

Insurance contracts in Luxembourg typically last a year and often automatically renew if you don’t terminate within an agreed notice period. You can typically cancel at any time although you need to give ample notice in writing. Notice periods can be as many as three months. Early termination can result in you being charged a fee.

If you want to change provider, some companies may offer to deal with the paperwork surrounding this as an incentive to you to sign up with them.

When you first sign up with an insurance company in Luxembourg, you should get a 14 day ‘cooling off’ period after signing, during which you can cancel without incurring fees.

Making a complaint about a car insurance company in Luxembourg

If you want to complain about a car insurance company in Luxembourg, follow these steps:

• Firstly, try to resolve the issue with the company itself. Each company should have a complaints department and a complaints procedure. These should be available on its website or in an information pack sent out when you sign up.
• If you are not satisfied with the outcome, or if the company doesn’t respond within 90 days, you can escalate the complaint to the Insurance Ombudsman.

Roadside assistance in Luxembourg

Breakdown assistance is only included with some fully comprehensive insurance policies in Luxembourg. If you don’t have it, many insurers offer this as an add-on for an additional fee.

Another option is to join a membership club. The most popular one is the Automobile Club de Luxembourg (ACL) which provides roadside assistance, car rentals, and various other services. Annual membership is €49.50, or €89.50 if you want coverage to include other European countries. Discounts are available for drivers aged under 25.

Useful resources

• Commissariat aux Assurances (CAA) – the regulatory body for insurance in Luxembourg
• TopAssur – an insurance comparison website
• Automobile Club de Luxembourg (ACL) – membership club that provides roadside assistance