Luxembourg life insurance returns in France: complete guide
Updated on 5 August 2026
The return on Luxembourg life insurance in France depends on the investment option chosen: euro funds post slightly lower rates than their French counterparts but benefit from the unlimited super privilege, while unit-linked funds and dedicated funds can target higher performance with a greater risk of capital loss.
- Luxembourg euro funds often post a lower return than the French average, since the market is narrower.
- Dedicated internal funds (FID) allow fully personalised management but remain opaque about past performance.
- The Luxembourg super privilege ranks policyholders as first-priority creditors, with no cap, against €70,000 of protection in France.
- Management fees on unit-linked funds can reach 1.5% to 2% at some Luxembourg insurers, depending on the policy chosen.
- Finary One supports investors with at least €500,000 in investable assets in structuring a Luxembourg policy.
As you may already know, Luxembourg life insurance is drawing growing interest. But what are its actual returns?
Between euro funds and unit-linked funds, we break down the performance of these high-end policies. We compare them with their French counterparts. Find out whether the extra complexity is really worth it for your wealth.
What is Luxembourg life insurance?
Life insurance in Luxembourg is a sophisticated financial product that is attracting a growing number of wealthy investors. Unlike its French counterpart, this type of policy offers greater flexibility and stronger asset protection, while keeping the traditional tax advantages of life insurance.
Differences with French life insurance
One of the main differences lies in the diversity of investment options on offer.
- Luxembourg policies include a wider variety of products.
- Each asset class offers an extensive choice.
- This openness allows for highly personalised asset allocation.
In particular, dedicated funds are an option rarely available in French policies.
| Investment option | Luxembourg life insurance | French life insurance |
|---|---|---|
| Euro fund | e.g. 1.92% (Generali Espace Lux Vie, 2023) | 2.60% on average (France Assureurs, 2025) |
| Unit-linked management fees | 1% to 2% depending on the insurer | Generally lower |
| Dedicated funds (FID) | From €500,000 to €1 million depending on the insurer | Not offered |
| Deposit protection | Unlimited super privilege, no cap | FGAP capped at €70,000 |
What is the return on Luxembourg life insurance?
Returns on Luxembourg life insurance depend heavily on the policy's composition and investment choices. Let's look at a few specific aspects to get a clearer picture of potential returns.
Performance of euro funds
Indeed, euro funds are less common in Luxembourg policies than in their French counterparts. However, they remain a useful indicator.
In 2023, the performance of Luxembourg euro funds proved slightly lower than that observed in France.
For example, the Generali Espace Lux Vie euro fund posted a return of 1.92% in 2023, the latest public data available for that fund. According to France Assureurs, the average return on euro funds stood at 2.60% in France in 2025, against 2.50% in 2024.
Comparison with French life insurance
This performance gap on euro funds should not be read as an overall disadvantage of Luxembourg policies.
Luxembourg policies stand out for their ability to hold a wider diversity of investment options, including more sophisticated unit-linked funds.
Limited transparency on dedicated funds' performance
The performance of dedicated internal funds (FID), specialised insurance funds (FAS) and collective internal funds (FIC) is generally not made public. These funds, managed bespoke for each client, can vary considerably from one policy to another.
What factors influence the return on Luxembourg life insurance?
The return on a Luxembourg policy depends on five levers: diversification of investment options, bespoke management, management fees, manager expertise and market conditions.
Diversification of investment options
The ability to invest across a wide range of assets can generate higher long-term returns. This includes structured products, private equity, or real estate, while increasing portfolio diversification.
Bespoke management
In practice, dedicated internal funds allow management tailored to each investor's risk profile and specific objectives. This can optimise performance depending on market conditions.
Management fees
In practice, the fees attached to Luxembourg policies can be higher than those of standard French policies. For example, management fees on unit-linked funds can reach 1.5% at Generali or 2% at Swiss Life Lux. These fees can affect the final net return.
Finary Life, the life insurance policy offered by Finary, applies management fees of 0.75% on the Netissima euro fund and 0.5% on unit-linked funds, with no entry, switching or contribution fees.
Manager expertise
The quality of management, especially for dedicated funds, plays a crucial role in performance. Luxembourg policies provide access to internationally renowned managers, which can translate into better long-term performance.
Impact of financial markets
As with any financial investment, the performance of Luxembourg policies depends on market conditions. The flexibility these policies offer can allow for better adaptation to different market phases, but it does not remove the risk inherent in unit-linked fund investments.
What are the advantages of Luxembourg life insurance?
The advantages of Luxembourg life insurance rest on three pillars: the security triangle, the unlimited super privilege and an open architecture with more than 1,000 investment options.
Security triangle: enhanced protection
The security triangle is one of the pillars of Luxembourg life insurance. This mechanism involves a strict separation between the insurer's assets and those of policyholders.
Policyholders' funds are held with an independent custodian bank, under the supervision of Luxembourg's Commissariat aux Assurances (CAA). This three-way structure offers investors additional protection if the insurer fails. Luxembourg policies are also exempt from the French "Sapin 2" law, which allows withdrawals on French-law policies to be temporarily restricted during a severe systemic crisis.
Luxembourg super privilege: an additional guarantee
In addition to the security triangle, the Luxembourg super privilege further strengthens the protection of policyholders. This legal provision ranks policyholders as first-priority creditors if the insurance company goes bankrupt.
Policyholders are given priority in recovering their funds, ahead of even privileged creditors such as the State or employees.
Open architecture and flexibility: bespoke management
A notable feature of Luxembourg life insurance is its open architecture. Unlike French policies, which generally offer a limited range of funds, Luxembourg policies offer a much wider choice.
For example, the Life Mobility Evolution policy offers more than 1,295 investment options. This diversity allows for highly personalised asset allocation, tailored to each investor's objectives and risk profile.
Dedicated internal funds: highly personalised management
For larger portfolios, Luxembourg policies often offer dedicated internal funds (FID). These bespoke funds are accessible from certain investment thresholds, generally around €250,000.
This option allows for fully personalised portfolio management, offering unmatched flexibility in the choice of assets and investment strategies.
Multi-currency and international diversification
Luxembourg policies often offer the option to invest in several currencies within a single policy. This feature allows for greater geographic and currency diversification.
This is particularly useful for investors seeking to reduce their exposure to currency risk or invest in international markets.
Tax neutrality and implications for French residents
Luxembourg applies a principle of tax neutrality for life insurance. For French residents, French life insurance taxation applies (subject to your personal situation, which may be affected by future legislative changes).
The tax treatment of the policy follows the rules of the policyholder's country of residence, offering tax continuity while still benefiting from Luxembourg's structural advantages.
To estimate the tax impact of a withdrawal or a wealth transfer on your life insurance policy, use Finary's life insurance simulator.
Luxembourg life insurance returns at Finary One
Finary One supports investors with €500,000 in investable assets in choosing and structuring their Luxembourg policy according to their wealth profile.
- Informed selection among 10 Luxembourg insurers (Lombard International, Wealins, Sogelife, Cardif Lux Vie, etc.), with access to FID funds from €500,000 in assets.
- A dedicated wealth advisor who structures the policy architecture in line with your overall wealth and objectives.
- Fee and banking margin negotiation, leveraging the volume Finary One channels to its Luxembourg partners.
Learn more about Finary One → Reserved for investors with €500,000 in investable assets. Investing carries risks, including the risk of capital loss.
Luxembourg life insurance: investment options
Luxembourg life insurance stands out for the richness and diversity of its investment options. This flexibility allows investors to build bespoke portfolios, tailored to their objectives and risk profile.
Euro funds: security and moderate returns
Although less common than in French policies, euro funds remain an option available in many Luxembourg policies. The Generali Espace Lux Vie euro fund, for example, offered a return of 1.92% in 2023 (linked to #7).
With these funds, capital is protected by the insurer, within the limits of its financial strength, and performance remains steady but modest compared with unit-linked funds.
Unit-linked funds: a wide choice of investments
Luxembourg policies excel at offering unit-linked funds. They generally provide an extensive range of investment options, from traditional funds to more sophisticated products.
For example, the Life Mobility Evolution policy gives access to close to 1,300 investment options, including ETFs and SRI funds. This diversity allows for fine-grained, personalised asset allocation.
Dedicated internal funds: bespoke management
For larger portfolios, dedicated internal funds (FID) are one of the most attractive options.
Accessible from certain investment thresholds, these funds allow for fully personalised management. In collaboration with a professional manager, the investor can define a unique investment strategy tailored to their specific objectives.
Private equity opportunities
Luxembourg life insurance also opens the door to asset classes that are less accessible through traditional policies, such as private equity.
This option allows investing in unlisted companies, potentially offering high returns but with a higher risk of capital loss and low liquidity. Including private equity within a life insurance policy allows investors to benefit from life insurance's favourable tax treatment for this generally illiquid asset class.
Real estate investments
Some Luxembourg policies allow investing in real estate through specialised funds or real estate investment companies. This option offers additional diversification and the ability to benefit from the real estate market's potential returns without the constraints of direct management.
Structured products: bespoke and sophisticated
Luxembourg policies can include structured products, offering specific return/risk profiles. These products, often designed bespoke, can meet precise objectives such as capital protection or the pursuit of conditional returns.
Delegated management: professional expertise
For investors who prefer to delegate the management of their policy, many Luxembourg insurers offer delegated management options.
At Cardif Lux Vie, for example, this option is available for an additional fee. This approach allows investors to benefit from the expertise of professional managers while keeping the flexibility and structural advantages of Luxembourg life insurance.
While its returns, particularly on euro funds, are not necessarily higher than those of French policies, its real value lies in its ability to adapt to the specific needs of wealthy investors.
For investors wanting to explore this solution, a conversation with a wealth advisor can help assess its relevance to their overall wealth situation.
Non-contractual document for promotional purposes. Finary One is Finary's private wealth management offer, reserved for investors with at least €500,000 in investable assets. Investing carries risks, including the risk of partial or total capital loss. Finary SAS - 58 rue de Monceau 75380 Paris 8 - ORIAS no. 21001279, under the supervision of the AMF and the ACPR.
Frequently asked questions
What is the average return on a euro fund in Luxembourg life insurance?
A Luxembourg euro fund generally posts a return slightly lower than the French average (2.60% in 2025 according to France Assureurs), due to a narrower market and more cautious management. The Generali Espace Lux Vie fund, for example, paid 1.92% in 2023.
Is Luxembourg life insurance more profitable than French life insurance?
Not necessarily on euro funds, where premium French policies often perform better. The appeal of Luxembourg life insurance lies mainly in access to a wider range of unit-linked funds, dedicated funds and alternative asset classes (private equity, real estate), which can generate higher returns in exchange for greater risk.
What is a dedicated internal fund (FID) in Luxembourg life insurance?
A dedicated internal fund (FID) is a bespoke fund, created for a single policyholder, whose allocation is defined with a professional manager according to their risk profile. Its access threshold varies widely between companies, from €500,000 to more than €1 million.
Is capital guaranteed in Luxembourg life insurance?
On a euro fund, capital is protected by the insurer, within the limits of its financial strength. On unit-linked funds and dedicated funds, capital is not guaranteed and carries a risk of partial or total loss, in exchange for higher potential performance.
From what amount can you access Luxembourg life insurance via Finary One?
Finary One supports investors with at least €500,000 in investable assets in choosing and structuring a Luxembourg policy, with access to dedicated internal funds and a selection among around ten partner companies.
Sources
Commissariat aux Assurances (CAA), Luxembourg's insurance regulator
France Assureurs, key life insurance figures
AMF, CASP ("PSCA" in French) whitelist, Finary SAS
Finary, the security triangle and France's €70,000 guarantee cap (FGAP)
Regulatory disclaimers: Marketing communication. Investing carries a risk of partial or total capital loss. Past performance is not a reliable indicator of future performance. This article is provided for information and educational purposes only; it does not constitute personalised investment advice, a buy or sell recommendation, or tax advice. The capital guarantee on euro funds is provided by the insurer and depends on its financial strength. In a severe systemic crisis, the French "Sapin 2" law allows withdrawals to be temporarily restricted (liquidity), without affecting the guaranteed capital. Unit-linked funds are not guaranteed and carry a risk of capital loss. Before investing, read the Key Information Document (KID) and, where relevant, consult an authorised adviser. Finary SAS, an investment firm authorised by the ACPR (no. 19283), member of AMAFI. Insurance broker registered with ORIAS (no. 21001279), member of the CNCGP (association approved by the AMF). Crypto-Asset Service Provider (CASP) authorised by the AMF under the MiCA regime, references no. A2026-026 and no. N2026-008.
