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Paris121 bis, rue de la Pompe, 75116 Paris, France

Luxembourg30, rue Marie-Adélaïde, L-2128 Luxembourg

Luxembourg life insurance and cross-border business

From Paris and Luxembourg, we advise Luxembourg insurers that market their contracts in France, and the private banks, asset managers and intermediaries that distribute them.

FranceLuxembourg

A Luxembourg contract taken out by a French resident is subject to two legal systems.

Life insuranceA contract under which an insurer undertakes to pay a lump sum or an annuity, at the end of the agreed term or on the death of the insured person, in return for premiums. In France, it is also widely used as a savings and wealth transfer vehicle.

Luxembourg law governs the insurer: its authorisation, the investment rules of the Commissariat aux assurances (⁠), the Luxembourg insurance supervisor, and the deposit of assets with a custodian bank; as a general rule, French law governs the contract, its taxation and the information given to the policyholder. We check, with Luxembourg lawyers on questions of Luxembourg law, that each choice holds under both systems: the internal fund, how the insurer operates in France, the distribution channel, the reinsurance of the (fonds en euros).

Euro fund (capital-guaranteed general fund)A life insurance investment option whose capital is guaranteed by the insurer, which credits it each year with a share of its profits (participation aux bénéfices).
CAACommissariat aux assurances: the supervisory authority for the insurance sector in Luxembourg.

What we do

01 Design

Contracts and internal funds

  • Adapting a Luxembourg life insurance or (contrat de capitalisation) to French law: general terms and conditions, pre-contractual information, surrender values, (renonciation).
    Capitalisation contractA savings contract offered by an insurer, similar to life insurance but not linked to the length of a human life: it does not end on death and can be passed on.
    Right of cancellation (renonciation)The right of the holder of a life insurance or capitalisation contract to withdraw from it within thirty days of being informed that it has been concluded. If the information documents required by law were not provided, this period is extended, for a holder acting in good faith, up to a limit of eight years.
  • Dedicated internal funds (⁠): investment policy annexed to the contract, financial information for the policyholder, coexistence of several management methods.
    Dedicated internal fund (FID)An internal fund of a Luxembourg insurer that underlies a single contract and has a single manager. As a rule, it requires a minimum premium of €125,000 and a policyholder in category A or above.
  • Specialised insurance funds (⁠), in which the policyholder chooses each asset, within the limits of their category.
    Specialised insurance fund (FAS)An internal fund that underlies a single Luxembourg contract and in which each asset is chosen by the policyholder, within the investment limits of the policyholder’s category.
  • Collective internal funds (⁠), with or without a guaranteed return.
    Collective internal fund (FIC)An internal fund of a Luxembourg insurer that is open to several policyholders. There are five types, from N to D, each available to policyholders of the corresponding category.
  • Eligible assets and investment limits set by ⁠, which takes over from Circular Letter 15/3, without repealing it, for contracts issued since 1 February 2026.
    CAA Circular Letter 26/1A text of the Commissariat aux assurances that sets the investment rules for Luxembourg unit-linked life insurance contracts issued since 1 February 2026. It takes over from Circular Letter 15/3, without repealing it.
  • Needs analysis and classification of the policyholder by the insurer, aligned with the French distributor’s (devoir de conseil).
    Duty to adviseThe obligation of the insurer or the distributor to propose a contract consistent with the client’s demands and needs, and to explain the reasons for that advice.
  • Agreements with the custodian bank (⁠) and with the fund’s investment manager.
    Security triangleA Luxembourg policyholder protection mechanism: the assets covering the insurer’s commitments are deposited with an approved custodian bank, under a tripartite agreement between the insurer, the bank and the Commissariat aux assurances (CAA).
  • Euro funds reinsured by a French insurer: clauses of the Luxembourg contract and policyholder information that follow from the ⁠.
    Reinsurance treatyAn agreement under which a reinsurer takes on part of an insurer’s risks or commitments, on terms defined for a group of contracts.
02 Steer

Cross-border business: freedom to provide services or branch

  • Choosing between the (FOS, libre prestation de services or LPS in French) and the (FOE), for a Luxembourg insurer in France or a French insurer in another Member State: constraints, tax implications.
    Freedom to provide services (FOS)The regime under which an insurer authorised in one State of the European Economic Area can cover commitments located in another Member State without being established there, on the basis of its home-State authorisation (the European passport). In French: libre prestation de services (LPS).
    Freedom of establishment (FOE)The regime under which an insurer from one State of the European Economic Area can operate in another Member State through a branch. In French: liberté d’établissement (LE).
  • Notification files for the supervisory authority of the home Member State (European passport).
  • Risk of recharacterisation as an establishment: an office in France, employees running distribution networks, an agent with permanent authority to act for the insurer.
  • Distribution agreements with French private banks, brokers and independent wealth advisers (CGPs).
03 Steer

Tax, unclaimed contracts and professional secrecy

  • Tax information for policyholders resident in France: the contract’s tax features, social security levies (prélèvements sociaux), reporting of contracts taken out abroad under Article 1649 AA of the Code général des impôts (CGI, the French Tax Code).
  • French-law tax representation mandate (mandat fiscal), by which the policyholder entrusts the Luxembourg insurer with carrying out their French tax obligations relating to the contract.
  • Exchanges of information with the French tax authorities and the Luxembourg insurer’s professional secrecy.
  • ⁠: application of French rules to contracts taken out in France, differences between the two legal systems, use of the life certificate.
    Unclaimed (dormant) contractsThe situation of life insurance contracts that remain unclaimed. The Eckert Act of 2014, in force since 2016, strengthens the search for insured persons and beneficiaries and provides for the sums to be transferred, after a set period, to the Caisse des dépôts. In French: déshérence.
  • Personal data protection and procedures for an insurer active in several Member States.
    AML/CFTAnti-money laundering and countering the financing of terrorism: the obligations of due diligence, customer knowledge and reporting to Tracfin (the French financial intelligence unit) that apply to insurers and intermediaries. In French: LCB-FT.
04 Defend

Disputes and remedies

  • Pre-litigation and litigation for insurers, private banks and CGPs before the French courts; in Luxembourg, advice and coordination with Luxembourg lawyers.
  • Disputes over the eligibility of underlying assets, the financial management of the contract and the financial information given to the policyholder.
  • Complaints to the European Commission about regulatory or tax obstacles to cross-border distribution.

Examples of matters

  1. 01

    Bringing into line with French law the life insurance and capitalisation contracts that Luxembourg insurers offer in France under the freedom to provide services.

  2. 02

    Financial information on dedicated internal funds, adapted to the requirements of the French Financial Security Act of 2003 (loi de sécurité financière).

  3. 03

    Setting up, for Luxembourg insurers, the French-law tax representation mandate and the use of the life certificate for unclaimed contracts.

  4. 04

    Structuring offers of specialised insurance funds, in the mid-2010s.

Frequently asked questions

Can a Luxembourg insurer market its contracts in France through independent wealth advisers, without a branch?

Yes. Authorised in Luxembourg, it can operate in France under the freedom to provide services after notifying the CAA, which informs the (the French prudential supervision and resolution authority). Each acts as an intermediary registered with ORIAS (the French register of insurance intermediaries), under a distribution agreement; the contracts must comply with French general good rules. But a permanent presence in France, such as an agent permanently authorised to act for the insurer, is treated as a branch.

Independent wealth adviser (CGP)An independent professional who advises clients on their wealth and who distributes, among other things, life insurance contracts as an intermediary. In French: conseiller en gestion de patrimoine (CGP).
ACPRAutorité de contrôle prudentiel et de résolution: the French authority, attached to the Banque de France, that authorises and supervises banks and insurers and oversees the protection of their customers.

Which law governs a Luxembourg contract taken out by a French resident?

As a general rule, French law. For life insurance, the applicable law is in principle that of the State where the policyholder is habitually resident, with a limited option to choose another, for example the law of their nationality. French rules on pre-contractual information and cancellation therefore apply. Luxembourg law continues to govern the insurer: authorisation, investment rules, deposit of assets, and the policyholders’ (super-privilège) if the insurer is wound up.

Super-priority rightThe first-ranking priority right that policyholders in Luxembourg hold over the assets covering their contracts if the insurer fails.

Must contracts taken out before 1 February 2026 be brought into line with Circular Letter 26/1?

Not automatically. CAA Circular Letter 26/1 applies to contracts issued from 1 February 2026. Earlier contracts and dedicated internal funds keep the investment rules in their annex, drawn up under the circular letter then in force, notably Circular Letter 15/3; an amendment can align that annex with the new rules. An internal fund notified or authorised before that date keeps the rules under which it was notified or authorised.

Does Luxembourg professional secrecy prevent the French tax authorities from knowing about the contract?

No. The Luxembourg insurer remains bound by professional secrecy, but the Luxembourg Act of 18 December 2015, which implements the OECD Common Reporting Standard and Directive 2014/107/EU, requires it to report to the Luxembourg tax authorities cash value insurance contracts held by policyholders resident in other States, including France. This information is exchanged every year. The French-resident policyholder must also declare the contract personally (Article 1649 AA of the CGI).