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Insurance for Expats in France

Submitted: November 2013

Any expat in France needs public liability insurance (assurance responsabilité civile). This is often sold separately and is very cheap (around €30 per year). Public liability insurance is a legal requirement for all tenants.

Do not wait for problems to arise before reviewing your insurance arrangements. Once you have a problem, it is already too late. Being poorly insured is risky whereas being over-insured is expensive.

There is a wide range of competing insurance providers in France, and it is advisable to shop around and compare before taking out an insurance policy.

If you are unclear about your cover or your needs whilst you are in France, you might wish to check your existing insurance arrangements in your country of origin. This is important if you want to avoid double coverage.

Insurance isn’t really a country-specific issue, but how much insurance you need may vary from one country to another. This is because your potential liabilities, such as medical bills, are specific to a jurisdiction.

Home insurance

Your home insurance needs depend on whether you own your home, or if you rent it.

A buildings insurance policy protects you against damage to your building, and is generally required to secure a mortgage. This may cover the costs of rebuilding your property from scratch or the costs of certain exceptional repairs. Generally, a property buyer is not supposed to be insured until ownership is effectively transferred.

As for all insurance policies, it is up to you to decide how generous you want your cover to be, what the excess amounts are, which unexpected expenses are covered (e.g. alternative accommodation or legal costs), etc.

Tenant insurance can be much cheaper than home insurance, but it only covers public liability. You can also opt to insure your belongings.

Going away from home

If you expect to be away from your home for more than one month, you should let your insurer know. Failure to do so may result in a claim being rejected if something happens to your home whilst you are away.

Home insurance exclusions

Check if something is excluded from your home insurance policy. If you live in a high risk area (e.g. with regard to floods), your insurer may require you to pay extra to be covered on some risks that your insurer would otherwise exclude.

Car insurance

Pursuant to article L211-1 of the French insurance code, third party car insurance is mandatory for anyone who drives a car in France. Failure to do so may attract, among other sanctions, a €3,750 fine and immobilisation of your car.

If you need your vehicle to have more than just third party cover, you might wish to take out a comprehensive vehicle insurance policy. As car insurance can be expensive, you should take some time to shop around and negotiate fair quotes.

Life insurance

Life insurance (assurance-vie) can be particularly helpful if your family is financially very dependent on you, as it may guarantee a lump sum payment to your family if you die.

The French are really keen to take out endowment policies because such policies often come with substantial tax benefits, such as tax deferral or declining tax rates as the life insurance contract extends in time. As a result, life insurance is often referred to as “France’s favourite financial product”.

In effect, life insurance has become like a mutual fund investment and many individuals actually sign up for life insurance solely to invest their savings. A Frenchman could even fail to understand the basic concept that underpins life insurance. In fact, French life insurance as an investment product is very complex. Given that the T&Cs can take tens of pages, you are likely to need professional advice.

Do assess carefully the burden of retaining foreign life insurance while you are resident in France. Do also check the geographical extent of your existing life insurance policy when you move across borders.

 

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