Guide to Car Insurance in Luxembourg for Foreigners

Relocating to Luxembourg can be both exciting and overwhelming. With its robust public infrastructure, excellent healthcare system, and multicultural atmosphere, the country is a top destination for expats. However, one aspect that often catches newcomers off guard is how car insurance works in Luxembourg.

Whether you’re moving in from Germany, France, or anywhere else, understanding car insurance in Luxembourg is crucial to avoiding costly mistakes.

In this guide, I’ll walk you through everything you need to know, from policy types and legal requirements to insurance premiums and real-life expat success stories.

Why Car Insurance in Luxembourg Is Non-Negotiable

In Luxembourg, for all vehicle owners. At a minimum, you must have civil liability insurance, known locally as responsabilité civile automobile. This covers damages caused to third parties in the event of an accident, including injuries and property damage.

Without this coverage, you can’t register your car. And if you’re caught driving without it, you could face heavy fines, vehicle impoundment, or even legal action.

Moreover, insurance is not just a legal formality. Given the rising costs of repairs and medical bills, having adequate coverage offers financial protection and peace of mind.

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Understanding the Types of Car Insurance in Luxembourg

There are three primary types of car insurance in Luxembourg. Choosing the right one depends on your vehicle’s value, age, and how often you drive.

1. Third-Party Liability (Responsabilité Civile)

This is the minimum legal requirement. It covers damage or injury caused to others, including pedestrians, other drivers, or passengers. However, it does not cover your own vehicle or personal injuries.

2. Partial Coverage (Assurance Partielle)

Also called “third-party, fire, and theft”, this policy goes beyond the legal minimum. It covers things like:

• Fire and explosion damage
• Theft and attempted theft
• Broken windows
• Natural disasters like floods or hail

It’s a good mid-range option if you drive a moderately priced vehicle or live in an area prone to environmental risks.

3. Comprehensive Insurance (Assurance Tous Risques)

This is the most complete form of car insurance in Luxembourg. In addition to third-party and partial coverage, it covers:

• Damage to your own vehicle, even if the accident is your fault
• Vandalism
• Hit-and-run incidents
• Personal injury (if added)

This is ideal for newer or higher-value vehicles, especially for foreign nationals who want hassle-free claims and premium-level service.

Factors That Affect Car Insurance Rates in Luxembourg

Insurance premiums vary widely depending on several factors. Based on my experience, these are the most important:

Driving History

If you’ve had a clean record in your home country, bring proof. Many insurers will consider it and offer lower premiums.

Vehicle Type and Age

Newer or luxury cars often come with higher premiums due to expensive repairs. Older models may qualify for discounts, but may also be limited in coverage options.

Location

Urban areas like Luxembourg City generally have higher rates due to increased traffic and theft risks.

Policy Add-ons

Adding options like roadside assistance, legal protection, or replacement vehicles will naturally increase your premium.

Average Car Insurance Premiums in Luxembourg: A Comparison Table

Below is a simplified comparison of average annual premiums from top insurance companies in Luxembourg. These are based on a 35-year-old driver with a 5-year clean record driving a mid-range vehicle (e.g., Volkswagen Golf):

Note: These are average figures. Actual quotes may vary depending on personal circumstances.

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Real-Life Story: From Germany to Luxembourg — Jakob’s Experience

Jakob moved to Luxembourg from Berlin for a job opportunity. He drove a 2019 Audi A4, fully paid off. Like many newcomers, he was unfamiliar with car insurance Luxembourg policies and was unsure whether to keep his German policy or get a local one.

When we first met, Jakob was leaning toward third-party coverage to save money. However, I advised him to consider the cost of potential repairs in Luxembourg, which can be significantly higher than in Germany. After a careful comparison of premiums, we settled on a comprehensive policy with Foyer Assurances that included legal assistance and a replacement vehicle.

Three months later, Jakob was involved in a minor accident. A pedestrian jaywalked, causing him to brake hard and hit a pole. His front bumper and headlights were damaged. Thanks to the comprehensive coverage, the repairs were fully covered, and he received a temporary car for work.

Jakob later told me, “It was the best insurance advice I’ve ever received. I would have been out over €3,000 without it.”

Insurance Tips for Foreigners Moving to Luxembourg

Here are a few expert suggestions based on my work with expats:

Register Quickly

As soon as you arrive and bring your vehicle, begin the process of registration and insurance. You’ll need proof of residence and vehicle inspection.

Translate Documents

If your driving history or license is from outside the EU, have it officially translated. This speeds up the underwriting process and helps lower your premiums.

Ask for No-Claim Bonus Transfer

Some insurers allow transferring your no-claim bonus from your home country. It can save you hundreds of euros annually.

3 Common Challenges to Avoid When Insuring a Vehicle in Luxembourg

1. Choosing the Cheapest Option

It’s tempting to pick the lowest price. However, if something goes wrong, cheap insurance may not offer enough protection or responsive service.

2. Skipping Legal Assistance

Traffic law in Luxembourg can be tricky for newcomers. Having legal protection as an add-on is worth the few extra euros per year.

3. Not Comparing Quotes

I always recommend comparing at least 3 quotes before choosing. Look beyond the price, consider service reputation, claims speed, and customer reviews.

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Conclusion: Choosing the Right Car Insurance in Luxembourg

Understanding car insurance in Luxembourg as an expat doesn’t have to be overwhelming. With the right guidance, you can find a policy that protects both your vehicle and your wallet.

Always remember: third-party insurance is the legal minimum, but comprehensive coverage often offers the best long-term value. If you’re driving a newer car or still learning the traffic landscape, it’s worth the upgrade.

And don’t hesitate to consult an experienced insurance broker. As someone who has worked with countless expats over the last decade, I can tell you: the right insurance makes a world of difference.

If you’re moving to Luxembourg soon or already live here and need help reviewing your car insurance policy, reach out to a broker for a personalized quote.