No-Claims Discount in Luxembourg: Can You Keep the No-Claims Discount You Earned Abroad?

Are you moving to Luxembourg with your car or planning to insure a new vehicle there? One question that often comes up among newcomers is: What happens to the no-claims discount you’ve earned in your home country?

After several years of accident-free driving, it’s natural to want to keep the benefits you’ve earned with your previous insurer. The good news is that, in many cases, your driving history can be taken into account when you purchase auto insurance in Luxembourg.

However, the Luxembourg no-claims discount system has certain specific features that are worth knowing before you arrive. Planning ahead will help you avoid starting from scratch and minimize the impact on the cost of your future auto insurance.

If you’re still in the process of looking for insurance, be sure to check out our guide: Car Insurance in Luxembourg: How to Choose the Right Coverage.

Does Luxembourg recognize a no-claims bonus earned in another country?

In many cases, yes. Luxembourg insurance companies may take your driving history into account when you move here from abroad. This recognition prevents an experienced driver from being treated as a new driver with no driving history.

However, whether your no-claims bonus is taken into account depends on several factors:

• the country of origin;
• the quality of the supporting documents provided;
• the length of your insurance history;
• the rules applied by the insurer in question.

Drivers arriving from France, Belgium, Germany, or Portugal can generally have their insurance history recognized more easily thanks to relatively comparable systems.

However, each company maintains its own assessment policy. It is therefore advisable to keep all documents proving your driving experience before you leave.

What documents should you request from your insurer before leaving your country?

Before you move, take the time to contact your current insurer to obtain a document summarizing your driving history.

This certificate is often the most important document for having your no-claims discount recognized in Luxembourg.

Depending on the country, this document may take various forms:

• information statement;
• no-claims certificate;
• claims history;
• certificate of good driving record.

The more detailed this document is, the easier it will be for your future insurer to assess your profile.

It is also recommended that you keep:

• your previous insurance policies;
• any endorsements;
• claims-free certificates;
• proof of cancellation of your previous policy.

These documents may be useful in case you have any additional questions when taking out your new auto insurance policy in Luxembourg.

Why is your no-claims bonus so important?

The no-claims discountis one of the main factors considered when calculating the cost of your auto insurance. A driver with a good driving record can benefit from more favorable terms than a driver who has been at fault in several accidents.

Keeping track of your driving history abroad is therefore a real financial consideration when you move to Luxembourg.

In the rest of this article, we’ll look at how the Luxembourg system works in practice and what specific features set it apart from those of many neighboring countries.

How does the no-claims discount system work in Luxembourg?

The no-claims discount is a mechanism used by insurance companies to assess the level of risk associated with each driver. Its purpose is simple: to reward drivers who do not file at-fault claims and penalize those who cause them.

The better your driving record, the more favorable your rating, and the more your insurance premium can be reduced. Conversely, one or more at-fault accidents can lead to an increase in the cost of your insurance.

While the principle is similar to that used in many European countries, Luxembourg has a unique feature that often surprises newcomers.

The Luxembourg quirk: two bonus-malus scales

Unlike some countries where a single rate applies to the entire policy, Luxembourg generally uses two separate scales.

This system allows the financial consequences of a claim to be differentiated based on its nature.

The no-claims discount for liability coverage

This first scale applies to damages caused to third parties in an accident for which you are liable.

It covers, in particular:

• property damage to another vehicle;
• damage to public infrastructure or equipment;
• bodily injury to other road users.

When a claim for which you are at fault is covered under civil liability, changes to your no-claims discount primarily affect this part of the policy.

The no-claims discount for property damage

The second tier applies to damage sustained by your own vehicle when such damage is covered by your policy.

This distinction prevents a single claim from systematically affecting your entire auto insurance policy.

For example, if you hit a wall while maneuvering and the repairs to your vehicle are covered, the impact will primarily affect the “property damage” portion of the policy.

This approach is often seen as more nuanced than a single system applied to all coverage types.

What happens in the event of an at-fault accident?

When an at-fault accident is reported to your insurer, your rating may increase when your policy is renewed. The impact depends, in particular, on the nature of the claim, the coverage involved, and the rules applied by your insurance company.

An at-fault accident does not necessarily result in the same premium increase for all drivers. Several factors may be taken into account:

• the level of no-claims discount earned prior to the claim;
• the type of accident;
• the coverage used;
• the driver’s overall driving record.

This is why it is often difficult to directly compare the consequences of an accident between two insurance companies or between two countries.

What if you’re not at fault for the accident?

In most cases, an accident for which you are not at fault does not have the same impact on your no-claims discount as an at-fault accident.

However, each case is analyzed based on the circumstances of the accident and the established liability. If in doubt, it’s best to ask your insurer about the potential consequences for your policy.

Why is it important to understand your no-claims discount before choosing an insurance policy?

Your no-claims discount directly affects the cost of your auto insurance. Two drivers with the same vehicle may therefore pay very different premiums depending on their driving history.

Before taking out a policy, it is therefore important to understand how your past driving record will be taken into account and how a potential claim could affect your premium in the years to come.

If you’re still comparing different insurance plans, check out our guide: Car Insurance in Luxembourg: How to Choose the Right Coverage.

The Most Common Mistakes When Moving to Luxembourg

Transferring your no-claims bonus may seem like a simple administrative formality. However, many newcomers discover too late that they could have benefited from more favorable terms if they had prepared their paperwork more thoroughly before leaving their home country.

How to Prepare for Your Move to Luxembourg?

A few simple steps taken before your departure can make settling in easier and save you from having to take additional steps once you arrive.

Before leaving your country of residence, it is advisable to:

• request a no-claims bonus certificate or an information statement from your insurer;
• keep a copy of your previous auto insurance policies;
• gather any proof of accident-free driving;
• check the validity period of the documents provided;
• prepare the documents related to your vehicle if you plan to register it in Luxembourg.

Taking these steps can save you time when you sign up for your new auto insurance policy.

The no-claims discount is just one of the factors in your future insurance policy

Maintaining a good no-claims record is a significant advantage, but it’s not the only factor to consider when choosing your auto insurance in Luxembourg.

The coverage options offered, deductibles, compensation limits, roadside assistance services, and coverage conditions abroad can all have an equally significant impact on your day-to-day protection.

To compare the different plans and understand the differences between third-party coverage and comprehensive coverage, check out our guide: How to Choose Car Insurance in Luxembourg.

No-Claims Discount in Luxembourg: A Key Factor in Your Insurance Cost

Your driving record can have a significant impact on the cost of your future auto insurance. Planning ahead before you move and keeping the right supporting documents will often allow you to credit the years of driving experience you’ve accumulated in your home country.

The Luxembourg system has certain specific features that are worth knowing, but with proper preparation, the transition generally goes smoothly.

Are you planning to move to Luxembourg? Check out our comprehensive guide to insurance in Luxembourg as well as our article on registering a vehicle in Luxembourg.

FAQ: No-Claims Discount and Auto Insurance in Luxembourg

Here are the answers to the questions most frequently asked by expats and newcomers.

Can I keep the no-claims discount I earned in France when I move to Luxembourg?

In many cases, yes. You’ll generally need to provide a no-claims certificate or a statement of information issued by your former insurer.

Can my Belgian or German no-claims bonus be recognized in Luxembourg?

Luxembourgish insurers often take into account driving records from several European countries. The final decision, however, depends on each company’s policy.

What documents should I request before leaving my country?

The most important document is usually the no-claims bonus certificate or the information statement provided by your current insurer.

Does a no-fault accident affect the no-claims discount?

As a general rule, only at-fault claims affect your no-claims bonus. However, the exact terms may vary depending on the situation and the policy.

What happens if I can’t provide a no-claims certificate?

Without proof, the insurer may have more difficulty taking your driving history into account. It is therefore strongly recommended that you request this document before you leave.

Is the no-claims discount the only factor that affects the cost of insurance?

No. The driver’s age, the insured vehicle, the level of coverage selected, annual mileage, and claims history also affect the premium amount.