Law of 30 March 2022 on Dormant Accounts, Inactive Safe-Deposit Boxes and Unclaimed Insurance Contracts

The Law of 30 March 2022, scheduled to enter into force on 1 June 2022, aims to establish a legal framework for dormant bank accounts, inactive safe-deposit boxes and unclaimed insurance contracts. This legislation strengthens the protection of savers and beneficiaries of insurance benefits while introducing new professional obligations for banks and insurance companies.

When Is an Account, Safe-Deposit Box or Insurance Contract Considered Inactive Under the Law?

For bank accounts: The account holder has not carried out any transaction on the account or any other account or safe-deposit box held with the same bank, and has not contacted or otherwise interacted with the bank in any way for a period of 6 years.

For safe-deposit boxes: The safe-deposit box holder has not contacted or otherwise interacted with the bank in any way and has not carried out any transaction on an account held with the same bank for a period of 6 years.

For insurance contracts: No beneficiary has claimed any insurance benefits that have become due and payable under an insurance contract for a period of 2 years.

When Must Banks and Insurance Companies Inform Account Holders or Beneficiaries?

For bank accounts: First notification threshold: 3 years | Second notification threshold: 9 years

For safe-deposit boxes: First notification threshold: 5 years | Second notification threshold: 9 years

For insurance contracts: First notification threshold: 1 year | Second notification threshold: 5 years

As soon as banks or insurance companies identify inactivity that has persisted for the first specified period, they must inform the account holder or beneficiary (or their legal successor) of the consequences of such inactivity within three months, by registered letter with acknowledgement of receipt. If no transaction or response is received from the account holder or beneficiary within three months following this notification, OR if the bank or insurance company is unable to contact the account holder or beneficiary using the information available to it, additional searches must be conducted to contact the person concerned and identify their legal successor.

If the inactivity persists until the second specified period, the bank or insurance company must notify the account holder or beneficiary again, or their legal successor, of the consequences of such inactivity within three months, by registered letter with acknowledgement of receipt.

When Must Banks and Insurance Companies Transfer Unclaimed Assets to the Caisse de Consignation?

For bank accounts: After 10 years of prolonged inactivity, the bank must apply to the Caisse de consignation (Luxembourg Consignment Office) for the deposit of assets held in the dormant account that have not been claimed by the account holder or their legal successor.

For safe-deposit boxes: After 10 years of prolonged inactivity, the bank must arrange for the safe-deposit box to be opened in order to deposit its contents with the Caisse de consignation. The opening must take place in the presence of a notary or bailiff, who is responsible for preparing an inventory.

For insurance contracts: After 6 years of prolonged inactivity, the insurance company must apply to the Caisse de consignation for the deposit of an amount equivalent to the insurance benefits due but not claimed by the beneficiary.

What Are the Key Takeaways from the Law of 30 March 2022?

Prevention

Banks and insurance companies must maintain regular contact with their clients to prevent accounts, safe-deposit boxes or insurance contracts from becoming inactive. They must also establish an appropriate internal organisation and ensure ongoing monitoring of accounts, safe-deposit boxes and insurance contracts identified as inactive.

The Obligation to Inform in Cases of Inactivity

Banks and insurance companies must inform their clients as soon as inactivity has persisted for a specified period (see above), failing which they may face administrative sanctions imposed by the Luxembourg Financial Sector Supervisory Commission (CSSF) or the Insurance Supervisory Authority (Commissariat aux Assurances, CAA).

The Obligation to Deposit Assets in Cases of Prolonged Inactivity

Banks and insurance companies must, after the applicable period of inactivity has elapsed, submit an application for the deposit of unclaimed assets with the Caisse de consignation, failing which they may face fines of up to EUR 1 million.