Comparison of Mandatory Insurance in Luxembourg

Published on September 30, 2025 and written by Cyril Jarnias

Luxembourg’s real estate market, currently experiencing significant dynamism, raises numerous questions, particularly regarding mandatory insurance for property owners and tenants. Within this vibrant context, understanding and comparing these insurance policies becomes essential for navigating the market with peace of mind.

This article provides a detailed overview of the various coverages required by Luxembourg legislation, while examining the specific characteristics that distinguish the Grand Duchy from its European neighbors. Specifically, it addresses questions related to costs, differences between available market options, and how certain insurance policies can offer optimal protection in case of damage.

Don’t miss the practical tips and in-depth analyses that will help you make informed decisions and optimize your real estate investment.

Home Insurance in Luxembourg: What Options Are Available?

In Luxembourg, several home insurance options are available to protect residences against various risks. Home insurance is not legally mandatory, but it is highly recommended. For property owners, subscription is often required by the bank when obtaining a mortgage. Tenants may be required to purchase insurance according to lease terms.

The main types of coverage offered include:

• Multi-risk home insurance: covers all movable and immovable property against a wide range of damages (fire, water damage, theft, weather events…).
• Fire coverage: covers damages caused by fire to the structure and belongings.
• Theft and vandalism coverage: compensation in case of burglary or intentional damage.
• Water damage and freeze coverage: repairs following leaks or pipe bursts.
• Personal liability insurance: financial protection if you unintentionally cause damage to others in a private context.

Type of Coverage	Description	Main Benefits
Multi-risk home	Comprehensive protection for home and furniture	Extensive coverage
Fire	Fire-related damages	Essential for mortgages
Water damage	Damage related to leaks or bursts	Common in residences
Theft	Loss or damage from burglaries	Enhanced security
Liability	Damage caused to others	Legal & financial protection

Several companies offer these policies in Luxembourg:

• Foyer
• Baloise
• LALUX

Each offers customizable plans with different levels (“Security,” “Comfort,” “Performance”) as well as specific packages (sustainable mobility, renewable energy…). Contracts can be tailored according to profile (owner/tenant), type of residence (house/apartment), and insured value.

Average costs vary depending on the insured area, geographic location of the property, and chosen coverage level:

For a standard apartment

• Basic multi-risk insurance: €120–200/year
• Comprehensive plan with options: up to €400/year

For a single-family home

• Basic multi-risk insurance: €200–350/year
• High-level comprehensive plan: up to €600/year

Tips for choosing the right insurance:

1. Accurately assess your needs based on your family and financial situation.
2. Compare multiple quotes from reputable insurers.
3. Carefully check exclusions and compensation limits.
4. Prioritize flexible plans that allow adding useful options later (solar panels, valuables…).
5. Use the “client assessment” tool offered by some insurers to clarify your expectations.

The key is to tailor your contract to your lifestyle while prioritizing flexibility and maximum protection to be effectively covered against daily unforeseen events!

Insurance Comparison for Property Owners

Main insurance companies for property owners in Luxembourg:

• AXA Luxembourg
• Bâloise Assurances
• LALUX Assurances
• Foyer S.A.
• Allianz Luxembourg

Comparison of Standard Coverages Offered:

Coverage	AXA	Bâloise	LALUX	Foyer	Allianz
Material damage (fire, water damage)	✓	✓	✓	✓	✓
Liability	✓	✓	✓	✓	✓
Theft	Option/✓	Option/✓	Option/✓	Option/✓	Option/✓
Glass breakage	✓	Option/✓	Option/✓	✓	✓
Storm, hail, snow pressure	✓	✓	✓	✓	✓
Natural disasters (flooding…)	option	option	specific package	option	option
Legal protection	option	option	specific package	option	option

Cost and Premium Analysis by Property Type:

• Standard apartment: annual premium between €120 and €220, depending on coverage level and furniture value.
• Single-family home: annual premium generally between €180 and €350, depending on area, location, insured value, and chosen options.
• High-end or luxury properties: premiums can exceed €500/year, especially with extensions for valuables or artwork.

Factors Influencing Cost:

• Living area
• Geographic location (risk zone)
• Declared value of property and contents
• Deductible applied by contract
• Chosen coverage level (economy, comprehensive, or premium)
• Subscribed extensions

Relevant Coverage Extensions for Luxembourg Property Owners:

• “Natural disasters” extension: useful in case of local flooding or exceptional storms.
• “Vandalism/sabotage” coverage: particularly recommended in urban areas.
• Insurance for valuables/art/paintings/wine cellars for exceptional assets.
• Extended liability coverage (non-occupant owner).

Common Scenarios Where These Insurances Are Implemented:

1. Accidental kitchen fire – coverage for structural repairs + appliance replacement + temporary relocation if necessary.
2. Burglary with theft of computer equipment – reimbursement with invoice after police report + fast claims assistance.
3. Water damage from common pipe burst – compensation for wall/ceiling repairs + leak detection included in some “comfort” offers.
4. Storm causing broken windows in veranda/garden – replacement covered according to plan.

Local Regulations Influencing Property Owner Insurance in Luxembourg:

• No general legal requirement for owner-occupiers; however frequent requirement via bank during mortgage (“mandatory home insurance”).
• Contract valuation must include the actual value of built-in kitchen equipment in the property.

Points to Watch When Subscribing to Property Owner Insurance in Luxembourg:

• Ensure all annexes/outbuildings are included in the insured perimeter (separate garage, cellar…).
• Verify the actual extent of theft/burglary/vandalism coverage outside main residence.
• Pay attention to compensation limits per category (standard furniture vs. valuables).
• Analyze the deductible applicable to each reported claim before final contract signing.

Key takeaway
It is essential for every Luxembourg property owner to accurately assess their specific needs before any subscription to ensure their insurance perfectly matches their personal real estate situation.

Liability Insurance: Essential Protection for Property Owners

Liability insurance is essential protection for property owners in Luxembourg. It covers third-party claims for damages caused to others or their property, thus protecting the owner’s assets from potentially disastrous financial consequences.

Examples of Covered Risks:

• Water damage caused by a leak from the residence damaging the neighboring apartment.
• Falling roof tile during a storm causing damage to a third party’s parked car.
• Injury suffered by a visitor due to a fall in common areas, attributable to the owner’s maintenance neglect.
• Material damage due to fire spreading to a neighbor’s property.

Types of Claims and Generally Included Coverages:

• Material damage (e.g., repairs after water damage or fire)
• Bodily injury (e.g., coverage of medical expenses if a third party is injured)
• Consequential immaterial damages
• Coverage related to pets (bites, material damage)

Insurer	Main Liability Coverages	Possible Extensions
Foyer	Personal liability included with home	Legal protection, electrical damage
Bâloise	Owner-occupier/non-occupier liability	Enhanced value for valuables
AXA Luxembourg	Family liability + home	Children’s school protection

Offers vary according to territorial scope (Luxembourg/abroad), compensation limits, and possibility to add extensions tailored to specific needs.

List – Common Extensions Offered:

• “Legal protection” guarantee in case of dispute with a third party
• Extension for damages intentionally caused by minors under subscriber’s responsibility
• Specific coverage for private pools or outdoor installations

Note:

• Liability insurance is not legally mandatory for private owners in Luxembourg, except in specific cases like dog ownership.
• However, it becomes almost essential when a mortgage is obtained: the bank then almost always requires multi-risk insurance including this coverage.
• Non-compliance can lead to immediate demand for full mortgage repayment by the bank and exposes the owner to personally compensating any victim in case of serious damage.

Concrete Examples Leading to Claims:

A co-owner neglects regular gutter maintenance; it overflows during a storm and floods the apartment below. The victim seeks compensation from their insurance, which then claims against the responsible party via their liability coverage.

When a dog briefly escapes its owner on private property and causes a fall for a visitor reading a meter; all medical expenses are covered thanks to this insurance.

Voluntary subscription strengthened with extensions therefore allows:

• Peace of mind against unforeseen events,
• Protection of assets against major risks,
• And often avoidance of lengthy or costly procedures with neighbors or injured visitors.

Rental Risk Coverage: How to Choose the Right Insurance?

Legal Obligations for Tenants and Property Owners in Luxembourg

• No general legal obligation to purchase home insurance for tenants or property owners. However, the tenant remains legally responsible for damages they cause to the rented property (fire, water damage) and must reimburse the owner. In practice, most lease agreements require the tenant to provide proof of home insurance covering rental liability.
• For property owners, home insurance is not legally mandatory, but it is frequently required by the bank when obtaining a mortgage. This insurance protects the property against damages (fire, water damage, etc.) and the owner’s liability in case of damages caused to third parties.

Main Types of Coverages Offered

Type of Coverage	Description	Primary Recipients
Rental liability	Reimbursement for damages caused to rented property (fire, water damage)	Tenants
Multi-risk home	Building damage, furniture, personal items, personal and/or owner liability	Owners, tenants
Unpaid rent guarantee	Coverage for rents not paid by tenant	Landlords
Material damage guarantee	Coverage for damages to property or furniture	Owners, tenants
Premium insurance	Protection for valuable items (artwork, wine cellars, etc.), expert assistance	Owners of exceptional assets

Comparison of Insurance Companies in Luxembourg

Company	Strengths	Additional Guarantees	Customer Service & Information Access
Foyer	Wide range of plans (economy to premium), fast claims handling	Legal protection, valuables	Online platform, personalized support
Baloise	Customizable contracts, tailored options based on profile	International coverage, personal liability	Simulation tools, advisor availability
AXA	Specialization in rental liability, coverages adapted for expatriates	Home assistance, owner’s furniture coverage	Clear documentation, personalized follow-up
Assurances de Luxembourg	Tailored advice, development of specific contracts	“All risks” guarantee, legal assistance	Real-time management, qualified staff

Practical Tips for Choosing the Right Insurance

• Accurately assess the value of your assets to avoid underinsurance or overinsurance.
• Analyze specific risks of the residence: flood zone, building type, presence of valuables.
• Compare basic coverages and options: some economy plans may suffice for a studio, while a villa will require comprehensive or premium coverage.
• Check exclusions and deductibles to know out-of-pocket costs in case of damage.
• Consider particular needs: landlord (unpaid rents, tenant damages), tenant (personal furniture, liability).
• Evaluate ease of information access (online simulators, client area, customer service availability).
• Prioritize insurers offering additional guarantees (legal protection, 24/7 assistance, international coverage).
• Consider the insurer’s reputation for claims handling and customer satisfaction.
• Read general and specific conditions carefully before signing the contract.

Specific Conditions of the Luxembourg Market

– High proportion of foreign tenants and non-resident owners, sometimes requiring specific or multilingual guarantees.
– Frequent practice of requiring insurance certificates in lease agreements.
– Presence of luxury or exceptional properties, justifying premium plans with expertise and extended guarantees.

In summary: choosing the right rental insurance in Luxembourg requires rigorous analysis of needs, comparison of offers, and consideration of local real estate market specificities.