Insurance Law in Luxembourg

The insurance industry offers some of the most prolific financial activities carried out in Luxembourg. The main laws governing insurance companies and their activities in Luxembourg dates back in 1991 and the Grand Ducal Regulation which was first enabled in 1994. The Luxembourg Insurance Law was last amended at the end of 2015. The main reason for amending the law was the introduction of the EU Directive on the solvency of insurance companies.

Our lawyers in Luxembourg can assist foreign investors seeking to open an insurance company in this country.

Insurance and reinsurance activities in Luxembourg

The Luxembourg Insurance Law provides for the incorporation of companies carrying out insurance and reinsurance activities. In order to be able to operate, a company must first register with the Companies Registrar and then obtain authorization from the Financial Supervisory Authority (Commissariat aux Assurances). The insurance legislation in Luxembourg is based on the free movement of services principles, which allows insurance and reinsurance companies to offer their services in other EU countries. The same principles apply to EU companies offering insurance and reinsurance services in Luxembourg.

Foreign investors setting up a reinsurance business in Luxembourg are subject to the approval of the Finance Ministry.

Opening an insurance company in Luxembourg

According to the Luxembourg Insurance Law, insurance and reinsurance businesses must take one of the following forms:

• -          of a limited liability company;
• -          of a partnership limited by shares;
• -          of a cooperative;
• -          of an European society.

The company must only carry out insurance or reinsurance activities. For companies in the reinsurance sector, the minimum funds to sustain such activities is 3 million euros.

Both types of companies can conclude insurance or reinsurance contracts, which fall under the Insurance Contract Law first issued in 1997. There are several types of contracts and services an insurance company can offer in Luxembourg.

Our attorneys in Luxembourg can offer more information on insurance contracts in the Grand Duchy. You can also contact us is you need other information on the new Insurance Law in the Grand Duchy.