In 2016 the national insurance sector had a record year, increasing its net profit after tax to €1,808 billion, a considerable rise of 45.7% compared to the previous financial year. This result far exceeds the previous record set in 2012. This strong performance can be attributed to non-life insurance and reinsurance which are both progressing at very fast rates of +53.78% and +55.91%.
Doubling of taxes paid by insurers
According to the 2016/2017 annual report by the Commissariat aux assurances (Luxembourg Insurance Commission), the taxes paidby insurance companies have increased considerably (98.7%) compared to the 2015 financial year, rising from €187 million to €372 million. The sum of the balance sheets increased by 3.86% to reach €227 billion, the life insurance share being €172.83 billion or 75.98% of the total. The life insurance share increased by 7.74%, while non-life insurance almost stagnated with growth of 1.24% and the reinsurance sector is shrinking (-8.86%).
At the end of the 2016 financial year, employment in the insurance sector increased by 2% to reach a total of 6,613 jobs. On the other hand, as in previous years, the number of insurance companies dropped slightly, settling at 299 units at the end of June 2017.
The positive consequences of Brexit
According to the Luxembourg Insurance Commission, the British decision to leave the European Union will lead to the relocation to Luxembourg of part of the operations of the large insurance groups affected by Brexit. At the time the annual report was published, one group was issued with a licence, two others had applied for licences in Luxembourg and three had announced their intention to do so. The Insurance Commission expects activity in the non-life insurance sector to double.(Article written by the editorial staff of the luxembourg.lu portal)