Changes to the Insurance Contracts Act in relation to Brexit – Commentary


The law of December 19, 2020(1) implementing the 2021 finance law introduced in the insurance contract law(2) a new provision aimed at securing the outcome of insurance policies taken out by British insurers after Brexit.

By amending article 2 of the law,(3) the legislator has removed any doubt as to the validity of insurance contracts in the event that:

  • an insurance company from the EEA or a third country loses its authorization to carry out direct insurance operations in Luxembourg while retaining its authorization in its State of origin; and
  • a contract has been validly issued or renewed by a company authorized to work in Luxembourg under the freedom of establishment or under the freedom to provide services at the time of the issuance or renewal of the contract.

Until then, in principle, any insurance contract covering risks located in Luxembourg entered into by an insurance company which is neither approved nor authorized to carry out insurance operations in Luxembourg is null and void.

However, these contracts cannot be renewed nor be the subject of any direct insurance operation giving rise to the issue of premiums after the loss of approval. This is in line with the post-Brexit transitional regime established by the law of April 8, 2019,(4) that the Insurance Commission (CAA) may exempt UK-based insurers from their licensing requirement for up to 21 months from the date of Brexit in respect of contracts entered into or renewed before Brexit .

For new underwriting or policy renewals in Luxembourg, third country insurers – including UK licensed insurers – will need to consider a long-term regulatory and contractual framework, including in relation to the establishment of a branch of a third country or of an insurance company approved in Luxembourg and supervised by the CAA.(5)

For more information on this subject, please contact Miriam Lassalle Where Josee Weydert from NautaDutilh Avocats Luxembourg by phone (+44 78 8426 1200) or email ([email protected] Where [email protected]). The NautaDutilh Avocats Luxembourg website can be accessed at the address


(1) Available here.

(2) Law of July 27, 1997.

(3) Available here.

(4) For more information, please see “Luxembourg draft Brexit law for the financial sector“.

(5) For more information, please see “Luxembourg draft Brexit law for the financial sector“.


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