Home insurance in Luxembourg: mandatory or not, tenant or owner

Is it mandatory?

For a tenant, there's no legal obligation. The Ministry of Housing strongly recommends taking out insurance that covers rental risks (tenant's liability, or "RC locative"). In practice, most tenants take one out, and landlords often ask for an insurance certificate.

Your lease can require it. Read it before signing: if it asks for insurance, it's no longer optional for you.

Social housing: the public landlord (Fonds du logement, SNHBM, municipality) can ask you, before handing over the keys, for a copy of the insurance policy covering rental risks and fire. Check with them.

Owner: in a co-ownership building, the building's fire insurance and liability insurance are among the expenses borne by the owner-landlord, not the tenant. If you're buying with a loan, ask your bank which insurance it requires before the deed.

Still looking for a home? Our guide finding a home in Luxembourg helps you with the next steps.

Tenant: what the law makes you responsible for

This is where insurance really makes sense, because the law makes you responsible by default:

• Fire: the Civil Code provides that the tenant is liable for fire, unless they prove the fire broke out through no fault of their own. If there are several tenants, they're liable for the fire in proportion to the value of the part of the building they occupy, except those who prove the fire couldn't have started in their home.
• Water damage and fire: according to the Ministry of Housing, throughout the lease, you're responsible for these incidents, whether or not you're present in the home. You escape this if you prove it isn't your fault, and you're not responsible in case of force majeure or a natural phenomenon, such as a storm.
• Damage: you're presumed responsible for damage in the home. It's up to you to prove it isn't caused by your fault, or that of the people living with you.
• Problems to report: if you notice deterioration or an urgent problem, you must inform your landlord quickly. If you do nothing and the damage gets worse, you're liable.

A fire starting in your kitchen can affect the whole building. Without insurance, the bill would be yours.

What your policy should cover

Home insurance (often called "multi-risk") combines several types of cover. Before signing, check at least these points in the general terms and conditions:

• Rental risks if you're a tenant: the fire and water damage you're liable for towards your landlord.
• Fire and its consequences: the law provides that fire insurance covers fire, lightning, explosion and implosion, and unless otherwise agreed, an aircraft crash and impact by a vehicle or animal. It also covers damage caused by the emergency services, and demolitions ordered to stop the fire.
• Your contents: the insured contents also include those of the people living with you, unless the policy excludes certain furniture.
• Your personal liability towards neighbours and third parties: check whether it's included, or whether you already have it separately. Our guide personal liability insurance explains what it covers.
• Theft, glass breakage, natural disasters: these aren't necessarily included. Each policy has its own list and exclusions.

The insured value. The policy can provide compensation at replacement value (rebuilding or replacing as new) without deducting wear and tear. Otherwise, an old sofa is reimbursed at its second-hand value.

How much it costs, and how to compare two quotes

There's no official rate for home insurance: each insurer sets its own prices, and two policies at the same price don't necessarily cover the same thing. What moves your premium:

• Tenant or owner: you're not insuring the same thing. As a tenant, it's mainly your rental risks and your contents. As an owner, the building also comes into play.
• The size of the home and the value of what's in it: the more there is to insure, the higher the bill. But don't underinsure: in case of underinsurance, the payout drops proportionally.
• The cover chosen: theft, glass breakage, natural disasters, liability… Before signing, the insurer must give you the definition of each type of cover with its limits and exclusions, the fees and taxes, and, where appropriate, the premium for each type of cover.
• The excess (deductible): accepting an excess can lower the cost of insurance. In return, the part of the loss it covers stays with you.

Before signing, compare:

• The sums insured: does the amount planned for your contents (and for the building if you're an owner) match their real value? If the insurer set that value, it can't in principle apply the proportional rule against you.
• Replacement value or depreciation: does the policy pay for replacement as new, or does it deduct wear and tear?
• The excess: its amount, and whether it changes depending on the cover.
• Water damage and frost exclusions: seepage, seals, frozen pipes… The law requires any exclusion to be highlighted in the policy: read them.
• The reporting deadline: how long the policy gives you to report a claim.
• Cancellation: the renewal date, the 30-day notice, and any penalties set out in the policy.
• Liability cover: included or not, to avoid paying twice or not being covered at all.

Comparing line by line takes time. An advisor can do it for you, based on your situation, and call you back.

Changing policy, moving, selling

• Changing insurer: you can cancel every year on the renewal date, by notifying your insurer 30 days before, by registered letter, bailiff's writ or letter handed over against a receipt. A price increase only applies from the next renewal date, and gives you at least 60 days to cancel.
• After a claim, your policy may allow the insurer to cancel, within a month of the first payment. You can then cancel your other policies with that insurer.
• You sell your home: the insurance ends automatically 3 months after the notarial deed. During these 3 months, the cover benefits the buyer, unless they already have their own policy.
• You move: remember to inform your insurer and get your new home covered from the day you get the keys. Our moving checklist helps you not forget anything.

If you disagree with your insurer, first make a written complaint. Without a satisfactory answer within 90 days, you can refer the matter free of charge to the Commissariat aux assurances (CAA), within a year of your complaint.