Understanding the car insurance no-claims bonus

Car bonus malus system in Luxembourg

Car insurance is compulsory if you own a vehicle in Luxembourg. The cost depends on the subscriber's bonus-malus.

The aim of the bonus-malus scale is to encourage responsible driving and penalize bad drivers. Although this system is used throughout Europe, each country is free to decide how it is applied.

How does it work in Luxembourg? Is it possible to claim your bonus in another European country? An overview of how the bonus-malus system works in Luxembourg with our partner Axa assurances Luxembourg .

A car insurance system based on two distinct scales

The bonus-malus system is a European practice designed to encourage responsible driving. The car insurance premium paid to the insurer increases in the event of an at-fault car accident.

Bonus-malus scales apply to at-fault accidents. Damage to the vehicle caused by bad weather, a knocked-down animal, broken windows, theft or breakdown will not affect the bonus-malus scale. Even if the insurer covers them.

In Luxembourg, most insurers apply two separate scales. The policyholder can therefore have two levels of bonus-malus, for different types of claim.

Third-party liability bonus-malus scale

It evolves in the event of damage caused to a third party following an at-fault accident. This scale is legal. All insurance companies apply the same rules for varying the degree of bonus-malus and increasing the car insurance premiums paid to the insurer.

Material damage bonus-malus scale

It varies according to the damage caused to your own vehicle. There is no legal framework here. Each insurance company sets its own rules.

A more advantageous insurance system in Luxembourg

In Luxembourg, the bonus-malus rate applies only to the cover in question. It affects Third-Party Liability cover, in the case of an at-fault accident involving a third party. In the case of damage to your own vehicle, it affects your Material Damage cover.

Simply put, a malus will only increase part of your insurance premium, not all of it. This means that increases are often lower in Luxembourg than in France, for example.

How do car insurance premiums change?

The legal third-party liability bonus-malus scale ranges from -3 (best bonus) to 22 (highest malus). 11 is the basic level for a new driver.

Over the years and in response to claims, the premium for third-party liability coverage has evolved as follows:

With each at-fault accident, your rating increases by 3 points the following year. Conversely, each year without an accident reduces your rating by 1 point.

Let's take the example of a driver starting out at 11. After 5 years without an at-fault accident, his grade drops to 6. If, in the sixth year, he causes an accident, his grade rises to 9.

Claiming your car bonus earned abroad

Are you moving to Luxembourg and wondering whether it's possible to keep the bonus you've earned over so many years abroad?

It all depends on your country of origin. Car insurance systems differ from country to country. However, there are equivalences with France, Belgium, Germany and Portugal.

To benefit from your previous bonus on your new insurance in Luxembourg, simply provide your new insurer with a bonus-malus certificate issued by your previous insurance company.

Arriving in Luxembourg? Find all the information you need about insurance here.

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