A Luxembourg unit-linked policy keeps your assets with an independent custodian, segregated from the insurer, and makes you a first-rank creditor if the insurer fails. Your premium and liquid wealth decide your investor category, from N to D, and what the policy may hold; a dedicated fund (FID) starts at EUR 125,000. Luxembourg does not tax non-resident policyholders: your home country does, and it learns about the policy through CRS.
Why wealthy families choose Luxembourg life insurance
Luxembourg is the private-banking world's favourite wrapper for long-term wealth. A Luxembourg unit-linked policy combines three things: protection of the assets if the insurer fails, a portable contract that follows you if you move, and an investment universe far wider than domestic policies, including dedicated funds run by your own manager.
Triangle of security
Custodian bank, insurer and regulator; assets segregated from the insurer.
Super-privilege
Policyholders rank first on the segregated assets, without ceiling.
Portable contract
The policy stays when you move; tax follows your new residence.
Dedicated funds
FID and FAS open private equity, bonds and structured products.
The triangle of security and the super-privilege, honestly
- The insurerIssues the policy and invests the premium in internal funds, but does not hold the assets itself.
- The custodian bankHolds the assets in segregated accounts, approved by the regulator, under a tripartite agreement.
- The regulatorThe Commissariat aux Assurances can block assets and supervises the insurer and the custodian.
If the insurer fails, policyholders rank first on the segregated assets, before employees, the tax office and every other creditor. What the super-privilege does not do is guarantee the value of the investments, or quick access: when FWU Life Insurance Lux went into liquidation in 2025, policyholders had to wait while the liquidation ran.
The super-privilege protects your claim on the assets. It does not protect you from bad investments or from waiting.
Investor categories: what you can put in your policy
| Category | Premium | Liquid wealth | Investment universe |
|---|---|---|---|
| N | No minimum | No minimum | Retail funds and ETFs |
| A | EUR 125,000 | EUR 250,000 | Adds bonds and a wider fund range |
| B | EUR 250,000 | EUR 500,000 | Adds alternative UCITS and more |
| C | EUR 250,000 | EUR 1,250,000 | Adds private equity, real estate funds, structured products |
| D | EUR 1,000,000 | EUR 2,500,000 | Broad financial instruments with few limits |
Liquid wealth excludes real estate. Both conditions must be met. Your category decides which fund type makes sense:
| Fund | Who decides | Typical entry |
|---|---|---|
| FID (dedicated internal fund) | An asset manager under your mandate | EUR 125,000 by rule, often EUR 250,000 to 500,000 in practice |
| FAS (specialised insurance fund) | You choose each investment | Depends on your category |
| FIC (collective internal fund) | The insurer's strategy, shared with others | Around EUR 100,000 to 125,000 |
| External funds | You pick from the insurer's fund list | Low |
How your country taxes a Luxembourg policy
| Residence | During the policy | On withdrawal | On death |
|---|---|---|---|
| France | No tax while invested | After 8 years an allowance of EUR 4,600, or EUR 9,200 for couples, then reduced rates plus social charges | EUR 152,500 per beneficiary tax-free for premiums paid before age 70 |
| Belgium | 2% insurance tax on premiums | Usually no tax on unit-linked gains without a guaranteed return | Regional inheritance tax |
| Netherlands | Policy value in box 3 every year | Covered by box 3 | Inheritance tax |
| Luxembourg | Not taxed | Generally exempt | Luxembourg inheritance rules |
Luxembourg itself does not tax non-resident policyholders. Everything above is your home country's tax; check it with your adviser before you sign.
Policy, holding, or both?
- Policy alone. Best for private investment wealth you plan to pass on: succession outside the estate in many countries and strong protection.
- Holding alone. Best for operating companies, real estate and anything needing treaty access.
- Holding with a capitalisation contract. A Luxembourg SOPARFI or a French holding invests surplus cash through a contract, keeping the company's balance sheet clean.
- Policy holding company shares. Possible in a dedicated fund within strict limits; insurers rarely accept controlling stakes.
Find your category and fund type
The result updates as you type.
Which Luxembourg policy can you access?
Two amounts and your residence. You get your CAA investor category, the fund types open to you and how your country taxes the policy.
Segregated assets and first rank, but not a value guarantee.
EUR 1 million and EUR 2.5 million unlock category D.
Luxembourg does not tax non-residents; your home country does.
Capitalisation contracts let companies use the same wrapper.
Luxembourg life insurance: frequent questions
Why is Luxembourg life insurance considered so secure?
Because of the triangle of security: the policyholder's assets are deposited with an independent custodian bank, segregated from the insurer's own assets, under the supervision of the Commissariat aux Assurances. Policyholders also rank first, ahead of all other creditors, on those assets if the insurer fails (the super-privilege).
What is the minimum investment for Luxembourg life insurance?
There is no legal minimum for a policy, but insurers usually start between EUR 100,000 and EUR 250,000. A dedicated internal fund (FID) needs at least EUR 125,000, and the widest investment universe requires EUR 1 million of premium and EUR 2.5 million of liquid wealth.
What is the difference between FID, FAS and FIC?
A FID is a dedicated fund managed by an asset manager under a mandate. A FAS is a specialised fund where the policyholder chooses each investment. A FIC is a collective fund shared by several policyholders with one strategy.
Is Luxembourg life insurance tax-free?
Luxembourg does not tax non-resident policyholders. The policy is taxed under the rules of the country where you live, so the tax result depends on your residence, not on Luxembourg.
Is a Luxembourg policy reported to my tax office?
Yes. Policies with a cash value are reported under the Common Reporting Standard to the policyholder's country of residence.
Can a company take out Luxembourg life insurance?
A company can subscribe a capitalisation contract, which works like a policy without a life insured. It is often used by holding companies to invest surplus cash.