Liechtenstein and Ireland: two EEA alternatives to Luxembourg for unit-linked PPLI

Liechtenstein and Ireland are the two other European Economic Area (EEA) jurisdictions most often considered alongside Luxembourg for unit-linked private placement life insurance. All three apply the EU Solvency II framework and let insurers write business in other EEA states through a notification procedure. They differ in what they add on top: Liechtenstein is known for rules in its Insurance Contract Act that let close family members named as beneficiaries step into a policy when the holder's creditors move against it; Ireland is a large cross-border life assurance centre whose own tax code contains an explicit statutory rule aimed at "self-selected" policy portfolios. Both are compared below with Luxembourg.

Why these two are compared with Luxembourg

Families may look beyond Luxembourg for a different legal tradition, a carrier group based elsewhere, or a particular protection feature.

The key distinction is which risk each feature addresses. Luxembourg's triangle concerns the insurer's creditors. Liechtenstein's beneficiary-entry rules concern the policyholder's creditors. Ireland's PPLP rule is not a protection rule at all — it is a tax rule for Irish residents.

Liechtenstein: regulator and framework

Insurers and insurance intermediaries in Liechtenstein "must be licensed by the Liechtenstein Financial Market Authority", according to a 2026 country guide by Ospelt & Partner published by Legal500. The Insurance Supervision Act (VersAG) governs direct insurers and implements Solvency II (Directive 2009/138/EC); the Insurance Contract Act (VersVG) governs the relationship between insurer and policyholder. The same guide reports a minimum capital of EUR 4,000,000 for life insurers under the VersAG (secondary source; confirm against the statute).

Three further points from that guide are relevant to PPLI buyers:

• Passporting. Liechtenstein has been an EEA member since 1995, so its insurers can serve other EEA states through the notification procedure. Liechtenstein also has an agreement with Switzerland on direct insurance and insurance intermediation that, in the guide's words, lets the two sides "mutually recognize the supervision system".
• No specific policyholder protection scheme. The guide states that "there is no specific protection scheme for policyholders"; protection rests on tied assets, solvency rules and disclosure.
• Portfolio transfers. If an insurer no longer meets requirements, the FMA may order its portfolio transferred to another insurer; policyholders then have a right to terminate within three months of notification.

Liechtenstein in figures

The FMA's annual financial-centre figures, presented on 22 May 2026, give an official sense of scale:

A sector-wide solvency ratio says nothing about any single carrier. For an individual insurer, read its own Solvency and Financial Condition Report (SFCR), which Solvency II insurers publish annually.

Liechtenstein: beneficiary entry and buy-out rights

The feature most often cited for Liechtenstein policies sits in the VersVG, amended by LGBl. 2020 Nr. 395 (promulgated 4 December 2020, in force with the parallel bankruptcy-law amendments). In summary:

Read together, these are beneficiary-entry and buy-out rights for defined family members, not a declaration that policy assets are beyond creditors' reach. Note that only Art. 77 is limited to attachment or bankruptcy opened in Liechtenstein; Art. 79 has no such territorial wording. Three limits follow:

1. They apply to the categories of beneficiary the law names; other beneficiaries do not benefit in the same way.
2. Art. 81 involves paying the surrender value — the family keeps the policy, the creditors receive value.
3. Creditors may still challenge a beneficiary designation or premium payment as a voidable transfer (Paulian action), and the effect of a Liechtenstein rule against a foreign court or foreign insolvency proceedings depends on that forum. This site does not state limitation periods; seek Liechtenstein counsel, and see asset protection for the wider picture.

Ireland: a cross-border life assurance centre

The Central Bank of Ireland states that it "is responsible for the supervision of life, non-life and reinsurance firms". Irish life insurers operate under Solvency II and, like Luxembourg and Liechtenstein carriers, can write policies for residents of other EEA states under freedom of services. This site does not quote market-share figures for Irish cross-border business, because it has not found an official source for them.

For non-Irish residents, an Irish carrier raises the same questions as any EEA carrier. Ireland becomes distinctive when the policyholder is Irish resident, because Irish tax law then applies an "exit tax" regime:

• The individual rate is 38 percent for chargeable events on or after 1 January 2026 (Finance Act 2025; Revenue s730K guidance), previously 41 percent; Revenue's exit-tax page gives 25 percent for companies.
• A chargeable event arises when "the life policy reaches the 8th anniversary of the date it commenced, and every subsequent 8 years after that" — the 8-year deemed disposal — with tax paid credited against tax due on a later surrender or maturity.

Ireland's personal portfolio life policy rule

Section 730BA of the Taxes Consolidation Act 1997 defines a personal portfolio life policy as a life policy or a foreign life policy whose benefits are determined by reference to property that "may be or was selected by" the policyholder or a connected person, or whose selection is "influenced by" them. Under s730BA(3), a policy is also caught if the holder can exercise an option to select the property, or can require the insurer to appoint an investment adviser who makes the selection.

The consequence, for Irish-resident individuals, is a higher rate. Revenue's s730K guidance table, for gains on foreign life policies:

This matters beyond Ireland for two reasons. First, an Irish-resident family can be caught whichever country issued the policy — a Luxembourg dedicated fund the holder steers can be a PPLP. Second, it illustrates a wider idea: a tax system may treat a policy differently when the holder can choose the underlying assets. The US investor-control doctrine reaches a similar point by a different route; see tax compliance. Other countries' rules are not covered here — check the holder's own jurisdiction.

Questions to ask when an Irish or Liechtenstein carrier is proposed

1. Which supervisor authorised the carrier, what does its latest SFCR show about solvency, and which custodian banks does it use?
2. Is the policy written under EEA freedom of services into your country of residence, and which law governs the contract?
3. For Liechtenstein: who are the named beneficiaries, do they fall within Art. 79 (spouse, registered partner, descendants), and how would a court in your country of residence treat these rules?
4. For Ireland, or any Irish-resident family member: could the policy be a PPLP, and what is the current exit-tax position?
5. What investment choices does the policy allow, and who makes them in practice?
6. How will CRS and FATCA reporting apply, and to which countries? Reporting follows the policy in the ordinary course.

Tax outcomes depend on the residence of the policyholder, insured and beneficiaries. Obtain advice in each relevant jurisdiction, including Singapore, Hong Kong and mainland China where applicable. The comparison table places these two jurisdictions alongside the other five. If you need help applying this to your situation, you can register an enquiry through the contact options on this site.