1.

As a Belgian resident, can I legally take out a life assurance policy in Luxembourg?

2.

What are the reasons for taking out a life assurance policy in the Grand Duchy of Luxembourg?

3.

Why a life assurance policy rather than a bank account?

4.

What are the advantages of PanEuroLife’s life assurance policies?

5.

Why is it called a "life assurance policy"?

6.

Can I take out an assurance policy together with my spouse?

7.

Is my money frozen? When and how can I recover the amounts I have invested?

8.

Can I modify the management of my policy over time?

9.

Do the beneficiaries of the policy have to be members of my family?

10.

What tax regime is applicable to me as a Belgian resident taking out a lifeassurance policy from a Luxembourg assurance company?

1.

As a Belgian resident, can I legally take out a life assurance policy in Luxembourg?

The answer is YES. Freedom to Provide Services (FPS) allows a company, whose registered office is located in one of the European Union countries, to distribute its products in the other Member States of the Union without having a permanent establishment there. Therefore, as a Belgian resident you can take out a policy offered by a Luxembourg life assurance company.

2.

What are the reasons for taking out a life assurance policy in the Grand Duchy of Luxembourg?

The Grand Duchy of Luxembourg has a stable environment favourable to financial activities. The country enjoys remarkable political, economic and financial stability.

A unique safe framework
In compliance with European directives, Luxembourg has defined a regulatory framework that is very strict in terms of security associated with assurance activity. Every life assurance company must indeed be approved by the “Commissariat aux Assurances” (CAA or insurance regulator) of the Grand Duchy of Luxembourg, which is responsible for monitoring activities of assurance companies in order to safeguard the policyholder's interests. Luxembourg legislation notably stipulates that the clients' assets must be deposited with a custodian bank approved by the “Commissariat aux Assurances”. The policyholders are preferred creditors and this preference takes precedence over all others – the result is exceptional security for assured parties. 

A high performance range of products
Luxembourg life assurance companies offer a wide range of sophisticated products particularly thanks to the investment flexibility they enjoy. In order to meet diversification requirements of international investors, the “Commissariat aux Assurances” has adopted legislation that allows considerable freedom in the choice of the type of assets underlying life assurance policies.

3.

Why a life assurance policy rather than a bank account?

All specialists agree that no investment can satisfy your various needs better than a life assurance policy, without mentioning your main concern: getting the highest return on your savings. The returns on life assurance products result from an investment policy optimized by portfolio management adapted to various investor risk profiles. It uses all the advantages of modern financial planning technology, stressing the safeguard of capital, transmission of your assets and protection of your loved ones. 

4.

What are the advantages of PanEuroLife’s life assurance policies?

Because of the internationalization of our financial market (Luxembourg), PanEuroLife's policies with multiple underlying assets, multiple profiles and multiple managers can give you access to various types of funds, ranging from guaranteed rate funds (branch 21) to share funds (branch 23), managed by the world's most prestigious asset managers. PanEuroLife also gives you the possibility of constituting your portfolio to meet your own risk criteria for duration and liquidity. If you have a portfolio valued at € 250 000 at least, PanEuroLife will be happy to propose personalised solutions to give you the benefit of the preferential environment of life assurance.

5.

Why is it called a "life assurance policy"?

In all the policies we propose, you will find the concept of the policyholder, the life assured, the beneficiary and the death cover. By means of this death cover associated with the policy, you can either provide a minimum capital for your heirs despite market fluctuations, or cover all or part of the inheritance tax. In addition, the money is released at the time of the notification of death.

6.

Can I take out an assurance policy together with my spouse?

Nothing prevents you from taking out an assurance policy together. Joint policyholders are accepted; so is the nomination of more than one life assured and/ or beneficiary.

7.

Is my money frozen? When and how can I recover the amounts I have invested?

You can dispose of your assets whenever you like by requesting partial or total surrender of your policy by means of the appropriate form. Although life assurance is a long-term investment, it is possible to meet a temporary or permanent need for cash assets without terminating the policy. However, special conditions in certain policies may impose restrictions or penalties associated with this surrender possibility. Total surrender terminates the policy.

8.

Can I modify the management of my policy over time?

Like your investment profile, which changes with time and circumstances, you can change the orientation of your investment at any time, by using the appropriate form to request a transfer of all or part of your savings into one or several other funds available within your policy. Consequently, the diversification of your assets will correspond faithfully to your profile. 

9.

Do the beneficiaries of the policy have to be members of my family?

No. The beneficiary can of course be a member of your family, but, on the other hand, there is nothing to prevent you from nominating a person with whom you have no family relationship as beneficiary of the policy, subject to compliance with the share reserved for heirs-at-law. The choice is up to you! 

10.

What tax regime is applicable to me as a Belgian resident taking out a lifeassurance policy from a Luxembourg assurance company?

Although Luxembourg taxation is totally neutral, you are liable to tax in your country of residence, just like for life assurance policies taken out from a Belgian assurance company. Under current legislation in force in Belgium, earnings made at the time of surrender of a branch 23 life assurance policy (denominated in units and not offering any guaranteed return), are totally tax-free. 

For a life assurance policy with a guaranteed return (branch 21 policies), earnings made in case of surrender (meaning the difference between the amounts paid – to the exclusion of beneficiary participations – and the total payments) are in principle taxable as movable assets at the rate of 15%, except: 

• when the policy provides a death cover in the event of death of at least 130% of the total payments

• or, in the absence of death cover, the policy is subscribed on the life of the policyholder (or holders in the case of a joint application) who maintains the investment without making any surrenders for a period of at least eight years.