Insights •Expat Corner• 27.03.2018 • Presented by Simône van Schouwenburg – Business Development ING Expat Services
(Photo: ING Luxembourg)
You have just arrived in Luxembourg and you don’t know what insurance are mandatory in the country? You want more information on additional coverage options you might need to protect yourself and your loved ones? Follow the guide!
Vehicle insurance (mandatory)
Most vehicles require insurance to operate legally in Luxembourg, including trucks, motorbikes, scooters, boats and planes. Bicycles do not need insurance. Only residents can take out vehicle insurance in Luxembourg.
If you have moved to the country with your car, you must insure it with at least a third-party liability insurance (assurance responsabilité civile or RC). This policy provides cover against damage to third party property resulting from an accident. Additional insurance against theft, fire, vandalism and other damages to the vehicle are not mandatory but can be covered in a comprehensive option called Casco (assurance tous risques). This option can be interesting, especially if your car is brand new and expensive.
You also have to take into account the cost of vehicle insurance. It varies from one insurance company to another and depends on the model, the power and the age of the car, as well as the age and the driving history of the driver. If you come from a country where car insurance has a system of no-claim bonus (known as bonus-malus system) – annual rates increase or decrease when an accident is your fault or not -, you have to obtain a certificate from your former insurance company stating the amount of no-claim bonus you have.
Whether they are residents or not, all employees and self-employees in Luxembourg must contribute to the healthcare system. If you are an employee, it’s your employer’s responsibility to withhold the appropriate amounts from your pay and remit them to the relevant health fund. If you are self-employed, you must pay the full contribution. Cover is for all dependent members of your household including children up to 30 if they are full-time students or unemployed, and includes most of the treatments provided by general practitioners or specialists, any laboratory test, prescriptions and hospitalisation.
More than 90% of your healthcare needs are covered by the National Health Fund (Caisse Nationale de Santé or CNS). However, you can opt to take out an additional private health insurance. Many employers also offer supplementary health cover to their employees as an employment benefit. The private insurance covers the portion of your medical fees that isn’t covered by the CNS and offers extended coverage for such things as hospitalisation, eye care, dental treatment and medical services outside Luxembourg. The big plus of having an additional insurance is to cover unexpected hospitalisation or unforeseen medical costs in a foreign country. So check carefully the terms and conditions before buying any private insurance policy.
Home insurance is not a legal requirement but it is highly recommended, whether you are a tenant or an owner. Housing prices in Luxembourg are quite high compared to other countries and any damage to your flat or your house can be very costly. The classic coverage offered by home policies provides protection of your household and the belongings you take into your home (furniture, electronic equipment, etc.) against fire and related events (lightning, electrical damage, etc.), weather or natural events, theft and vandalism, glass breakage and water damage. Depending on the insurance company, you can also take additional coverage against natural hazards such as storm, hail, snow, ice or even earthquake!
Private liability insurance
You and your loved ones might unintentionally cause damage to a third party and the financial consequences might be substantial. Taking out a private liability insurance for you and your family is not mandatory but it is a good way to protect yourself against potential problems involving third parties. This insurance covers you and your family in situations such as when walking or cycling, when playing sports, for damage caused to other people by your pet or for damage caused to other people by your household or garden appliances.
If you have a pet in Luxembourg, taking an insurance for domestic dogs and cats might be useful. Owning a pet can be very expensive and vet bills can be enormous especially in case of accidents when your furry friend needs to be operated on. Pet insurance covers vet and vaccine costs, limited costs for hospitalisation, costs to help find your pet if you lose it, ambulance costs and even accommodation for your pet in case you are hospitalised. To be qualified for insurance, your dog or cat must be chipped and be more than three months and less than seven (for a dog) or ten years old (for a cat). Unfortunately, the choice is very poor in Luxembourg. Only one company offers pet insurance in the Grand Duchy.
Of course, there are plenty of other insurance policies but most of them are useful in the long run. You don’t need them immediately and have some time to think about.