You’ve just arrived in Luxembourg and need to take out car insurance for your car here? Make sure you have all the facts at hand, as there are bound to be quite a few differences with your country of origin: pricing, deductible system, extent of comprehensive insurance… We give you the lowdown here.
#1 Insurance before registration
If you have to register your vehicle in Luxembourg, keep one thing in mind: you will first be asked to show an insurance certificate. This is the procedure to follow:
- Ask for a licence number, which you must have before taking out the insurance
- Contact an insurance company and take out car insurance.
- Only then will you be able to have your new licence plates fitted.
#2 What on earth is Casco?
Casco is a very common term in Luxembourg. But what does it actually mean? Casco cover simply means that you have the best possible level of coverage. It is the equivalent of fully-comprehensive insurance.Be careful, because from one country or insurer to another, this optimal level of cover may differ. Ask your insurance company for more information.
#3 The deductible is not a thing
You may be used to being charged a deductible systematically in the event of material damage to your car, i.e. you pay part of the cost of repairs out of your own pocket when the amount exceeds a certain threshold.
That’s not how it’s done in Luxembourg. If the loss is covered, fully-comprehensive insurance (yes that casco word again) covers the repair of the material damage in its entirety.
However, with some insurers such as AXA, you can ask for a deductible when you take out your policy. This allows you to lower your premium.
#4 The glass breakage coverage is not limited to windows
In some neighbouring countries, repairs to a rear-view mirror or a headlight are only covered by the insurer if the insured has taken out fully-comprehensive cover.
In Luxembourg, you don’t need the so-called casco cover for this. This type of damage is included in the glass breakage cover, and no penalty is applied.
#5 Car insurance is generally more expensive
A car insurance premium in Luxembourg is likely to be 30 to 50% higher than in France for example. This can be surprising. But this difference can be explained by the better levels of cover explained above. In the event of a claim, it is rare to have to pay out money.
# 6 Breakdown assistance is optional
Make sure you know the difference between accident assistance and breakdown assistance. Accident assistance is automatically included in most insurance contracts: if your vehicle is immobilised following an accident, your insurer will help you out without any problem.
However, in the event of a breakdown (if you run out of fuel or misfuel, a flat battery, etc.), you must have taken out an option to be entitled to a breakdown service. It’s worth considering, especially since it’s not that expensive: about €65 a year at AXA.
Please find here more details about vehicle assistance proposed by AXA Luxembourg : assistance in the event of an accident, a breakdown or a flat tyre, purging and towing in case of fuel error, opening the vehicle in the event of lost or fogotten keys.
# 7 The rules for calculating the no-claims-bonus are specific to each country
Although this system is used throughout Europe, each country has its own rules. It is important that you are aware how the Luxembourg rules work to fully understand how your premium will evolve over time.
For example, most insurers in Luxembourg use two different scales: one deals exclusively with Civil Liability and evolves according to the damage you cause to third parties in accidents where you are at fault. The other is for Material Damage to your own vehicle, caused by yourself or by an unidentifiable third party.
A two-tier system means that if you incur a penalty, the associated percentage increase is applied only to part of your premium, depending on the type of accident that has occurred.
For example, if you have damaged your door against a wall, a Material Damage penalty will be applied to you. It is the portion of your premium related to Material Damage coverage that will increase; the rest of your premium will remain the same. The premium increase is therefore less significant.
Click here to find out more about how the no claims bonus system works in Luxembourg.
If you come from France, Belgium, Germany or Portugal, you can claim the no-claims bonus you had in your home country in Luxembourg; all you have to do is provide your new insurer with a bonus-penalty certificate.