Compulsory insurance

The law imposes the principle of compulsory insurance applicable to all persons who carry out a professional activity in Luxembourg in return for remuneration, either on behalf of another person or on their own account, or who can provide evidence of periods treated as equivalent to such periods of professional activity.

The scope of compulsory insurance is therefore characterised by the exercise of a professional activity subject to insurance and covered by contributions. Compulsory insurance periods also include periods covered by contributions which do not correspond to professional activities, but which are assimilated to them for social or social policy reasons (e.g. war periods, military periods).

These are periods resulting from a professional activity carried out under an employment contract binding the insured person to an employer in return for remuneration.

Since the implementation of a single status, the general scheme applicable to the private sector and regulated by the Social Security Code no longer makes any distinction on the basis of belonging to a particular socio-professional category.

These are:

• activities relating to the agricultural profession, defined in relation to the legislation on professional agricultural chambers, insofar as they are carried out on their own account.
• activities relating to the liberal professions defined in relation to other self-employed activities, in particular by the criterion that they must be mainly intellectual and non-commercial in nature.
• self-employed activities as defined in relation to those provided for by the legislation relating to the Chamber of Trades and the Chamber of Commerce.
  

Persons included in this category are:

• members of general partnerships, limited partnerships or limited liability companies whose purpose is to carry on such an activity and who hold more than twenty-five per cent of the company's shares
• directors, general partners or agents of public limited companies, partnerships limited by shares or cooperative societies whose purpose is to carry out such activities, who are delegated to carry out day-to-day management tasks
  

provided that they are persons on whom the establishment authorisation is based.

In principle, this refers to periods:

• of unemployment benefit
• of sickness, maternity or adoption cash benefits
• of early retirement
• of accident allowances (for accidents occurring as of 01.01.2011)
• of Social inclusion income (“Revenu d’inclusion sociale – REVIS) for holders with at least 25 years' compulsory enrolment in pension insurance.
  

This provision, which is specific to self-employed professions, calls for the following comments:

Parents, children and relatives of the principal insured person are enrolled as assistants when they are working in agriculture, but as employees when they are working in a trade or craft.

The insured activity must be the main activity of the assistant. This means that secondary employment as an assistant is not insured.

The "baby year" is a two-year insurance period credited to the parent who devotes themself in Luxembourg to the upbringing of a legitimate, legitimated, natural or adopted child under the age of four at the time of adoption. The period of twenty-four months provided for is extended to forty-eight months if, at the time of the birth or adoption of the child, the person concerned is bringing up at least two other children in their household or if the child suffers from one or more conditions constituting a permanent impairment or reduction of at least fifty per cent of the physical or mental capacity of a normal child of the same age.

The "baby year" is taken into account, on request, provided that the insured person has twelve months of compulsory insurance periods during a reference period of thirty-six months preceding the birth or adoption of the child. This reference period is extended if and insofar as it overlaps with child-raising periods. The twenty-four-month period taken into account must not overlap with an insurance period covered by a special Luxembourg scheme or a foreign scheme.

It begins in the month following the birth or adoption of the child or, where applicable, the month following the date on which the maternity benefit expires.

The twenty-four- or forty-eight-month period may be divided between the parents, provided that the maximum period is not exceeded. The parents designate the beneficiary of the insurance periods or, where applicable, agree to share the periods by means of a joint application. This decision cannot be changed. Failing an agreement between the parents and in the absence of proof from the applicant parent that they have assumed sole responsibility for the child's upbringing, the said period is shared equally between the two parents.

For periods covered by the "baby year", the monthly average of pensionable income taken into account under compulsory insurance periods during the twelve insurance months immediately preceding that of childbirth or adoption is taken into account. However, the income taken into account may not be less than 270.28 euros per child per month at cost-of-living index number 100 and at 1984 as the base year.

The periods are validated when a pension application is examined.

See also: Child-raising periods (point 4 under additional periods)

Additional information: child-raising pension (also known as “Mammerent")

If the conditions for a "baby year" are not met, the parent who has devoted most of their time to bringing up the child may be entitled to a child-raising pension. Applications for a child-raising pension should be sent to the Fonds national de solidarité (FNS).

Account is also taken of periods of recall as well as periods of incapacity for work resulting from an accident sustained or a serious illness contracted during such service, provided that these periods are not otherwise covered by social security contributions.

In accordance with the law of 27 July 1992 on Luxembourg's participation in peacekeeping operations within the framework of international organisations.

Within the meaning of the law of 2 August 1997 reorganising the army and amending the law of 27 July 1992 on Luxembourg's participation in peacekeeping operations (PKO) within the framework of international organisations.

Long-term care insurance covers the pension insurance contributions of a person who is not in receipt of a personal pension and who provides assistance and care to the dependent person at home outside of an assistance and care network, up to a maximum contribution calculated on the basis of the minimum monthly social wage for an unskilled worker aged eighteen or over.

This placement must have been made by an approved organisation in accordance with the legislation governing relations between the State and organisations working in the social, family and therapeutic fields.

This includes childminders who provide childcare in their own homes.

The aim of the law of 31 October 2007 is to encourage young people to become actively involved in society by making it easier for them to carry out activities which are in the public interest. Voluntary service is carried out through non-governmental organisations and is not a substitute for professional work. Voluntary service lasts between three and eighteen months.

More specifically, this is the supplementary allowance provided for in Article 18(3) of the amended law of 29 April 1999 creating the right to a guaranteed minimum income, from which contributions are deducted and paid for pension insurance when the insured person has an insurance record of at least 25 years.

This is the income paid in accordance with article 27bis of the amended law of 12 September 2003 relating to disabled persons, on which contributions are deducted and paid for pension insurance when the insured person has an insurance record of at least 25 years.