The Luxembourg-based life insurance contracts provide the strongest protections amid EU countries guaranteed by a tripartite agreement between the Commissariat aux Assurances (CAA) - a public institution under ministerial authority -, the insurance company and the custodian bank.
This tripartite agreement is commonly called the SAFETY TRIANGLE:
It establishes a strict segregation between the assets of the policyholder and the shareholder and creditors of the insurance company.
In case of failure of an insurance company, the policyholder shall be deemed a preferred creditor of first rank on the mass of the assets covering the technical provisions. The policyholder takes thus precedence over all the other creditors, whoever their status.
The admittance to the profession of insurer or insurance intermediary, as a natural person or legal entity, requires a ministerial approval.