To be entitled to a disability pension, the insured person must provide proof of at least 12 months of insurance under compulsory, continued or optional insurance during the 3 years preceding the date of disability established by the Social security medical board or the expiry of the sickness benefit. This 3-year reference period is extended insofar as and to the extent that it overlaps with complementary periods or periods corresponding to the benefit of the social inclusion income (REVIS) or the severely disabled allowance. However, this period is not required in the event of the insured’s disability due to an accident of any kind or a recognised occupational disease which occurred during the period of membership.
The medical criterion of disability must be recognized. An insured person is considered to be disabled if, as a result of prolonged illness, infirmity or weakening, he has suffered a loss of working capacity such that he is unable to carry out the occupation he last exercised or any other occupation corresponding to his strengths and abilities.
In addition, insured persons must follow the rehabilitation or retraining measures that may be prescribed by the pension fund on the proposal of the Social security medical board until the age of 50, or risk losing the pension. On the basis of the proposals of the medical board, the pension fund shall decide on the medical, vocational and social rehabilitation and retraining measures to which the person concerned must submit.
The granting of a disability pension is subject to the condition that the person concerned give up any activity in Luxembourg or abroad other than insignificant ones, i.e. ones with an income that does not exceed 1/3 of the social minimum wage. The pension is suspended if the self-employed activity is carried out by another person on behalf of the insured person.
The monthly minimum wage is €2,570.93 as of 1 January 2024; 1/3 of this amounts to €856.98.
Where the disability is only temporary, the pension shall be payable on expiry of the entitlement to sickness benefits or, in the absence of such entitlement, on expiry of an uninterrupted period of disability of 6 months. The disability pension shall not be awarded for a period of more than one year prior to receipt of the application.
Where the pension had already been granted for a limited period, it shall be reallocated in the event of a relapse as from the first day of the new period of disability, as long as entitlement to cash sickness benefit has not been restored.
The disability pension shall be payable from the first day of a disability is established, but not before the day on which the qualifying period is fulfilled. In the case of self employment, the pension does not begin to run until that activity ceases. If the remuneration of the salaried activity carried out before the risk expired is retained by law or by agreement, it shall only start to run from the day on which this remuneration ceases. If the disability is mainly due to an accident at work or an occupational disease declared after 31 December 2010, the disability pension only starts to run from the date of consolidation (the moment when, following the period of treatment, the injury becomes fixed and definitive, such that treatment is in principle no longer necessary except to avoid aggravation, and it is possible to assess a certain degree of permanent disability resulting from the accident, subject to possible relapses and revisions).
For the period during which the insured person receiving a disability pension also received financial compensation for sickness from the Luxembourg insurance scheme as a result of the professional activity carried out before the risk expired, the disability pension is paid to the competent health insurance fund, which passes on any difference to insured persons.
If the date of commencement of the disability cannot be established, it shall be deemed to be the date on which the application for the pension was received by the National pension insurance fund.
When does the disability pension become an old-age pension?
Without a formal decision to that effect, all current disability pensions convert to old age pensions when beneficiaries reach the age of 65. However, if the beneficiary has wages, salaries or income subject to compulsory insurance contributions during the period of entitlement to the disability pension, the proportional increases shall be recalculated and, where appropriate, the minimum pension supplement shall be reduced, without reducing the total amount of the pension. For this purpose, the rate determined at the date of commencement of entitlement to the pension shall apply.
The annual disability pension consists of the following pension elements:
Proportional increases determined in the same way as for the old-age pension.
Special proportional increases corresponding to the product obtained by multiplying the rate of proportional increases applied to the reference base by the number of years remaining from the beginning of entitlement to the pension until a person reaches the age of 55.
As a general rule, the reference base is a notional income which is established by dividing the amount of wages, salaries or contributory income taken into account between the beginning of the calendar year following that in which the insured person reached the age of 24 and the date the risk expires, by the number of years in that same period. However, this period may be neutralised by periods of receipt during which a previous disability pension was received, periods of uncompensated vocational training, waiting periods for unemployment compensation, periods of child-rearing and periods after 1 January 1990 during which a concerned person may have provided care for someone so helpless that they could not survive without the care of others.
The flat-rate increases are determined in the same way as for the old-age pension.
The special flat-rate increases correspond to as many fortieths of the product of multiplying the rate of the flat-rate increases by the reference amount (€2,085 per year, number 100 of the cost-of living index on 1 January 1948 and the base year of 1984) as there are years missing between the beginning of the entitlement to the pension and the age of 65 years, with the proviso that the number of years taken into account may not exceed 40, taking into account the flat-rate increases. Any year started counts as a whole year.
However, prospective periods (which artificially extend an insured person’s career until the age of 65) are taken into account for special flat-rate increases only if an insured person has an uninterrupted insurance contribution record before the risk expires. Otherwise, they are paid only in the proportion of the number of years of insurance periods completed from the age of 25 to the number of years between that age and the date of the risk (if the insurance periods between the age of 25 and the beginning of the disability is 80%, the prospective periods can only be taken into account in the same proportion).
An end-of-year allowance calculated in the same way as for old-age pensions.
Example of a disability pension calculation in January 2024
(For the sake of simplicity, the calculations are made for January 2024. In fact, all amounts are taken into account for their value reduced to index 100 on 1 January 1948 and set out for the base year 1984. The income simultaneous with the pension is reduced to the base year level by dividing it by the revaluation factor and the index).
Data
Date of birth: 01.06.1978
Beginning of the calendar year following the year in which the insured person reached the age of 24: 01.01.2003
Completion of the 55th year: 01.06.2033
Completion of the 65th year: 01.06.2043
Termination of employment: 31.12.2023
Total insurance contribution period from 1992 to 2023: 372 months
Total professional income during this period: €520,000
Start of pension: 01.01.2024
Reference base from 01.01.2003 to 01.01.2024: €18,000
Flat-rate increases Normal (a)
372 months / 12 = 31 years i.e. 31/40 of €619.82 = €480.36. Special (b)
from 01.01.2024 to 01.06.2043 = 233 months / 12 = 19.41 years
However, (a) + (b) cannot exceed a maximum of 40 years, so 40 – 31 = 9 years, i.e. 9/40 of €619.82 = €139.46.
Proportional increases Normal
1.775% of €520,000 = €9,230 / 12 = €769.17 Special
from the beginning of the pension until the age of 55
= from 01.01.2024 to 01.06.2033 = 113 months = 9.41 years
= 1.775% of 9.41 x annual reference base / 12
= 1.775% of 9.41 x €18,000 / 12 = €250.54 Scaled
Age + career at risk maturity: 46 + 31 = 77 < 95; hence €0 (no staggered increase in the rate of proportional increases) Gross monthly pension = €1,639.53 End-of-year allowance
372 months / 12 = 31 years or 31/40 of €958.94 = €743.18
As with the old-age pension, no disability pension can be less than 90% of the reference amount if the insured person has completed a 40-year contributions period.
The minimum pension in January 2024 is a guaranteed monthly amount of €2,244.82.
In the event of early disability, the number of years missing between the beginning of entitlement to a pension and the age of 65 shall be taken into account for the purpose of completing the abovementioned period, but the total number of years may not exceed 40. Where disability occurs after the age of 25, the number of missing years shall be taken into account only in the proportion which the total period of insurance between the beginning of the year following that in which the insured person reached the age of 24 and the date on which the risk became payable bears to the total number of calendar years in that period. Where necessary, a supplement shall be awarded.
Disability pensions are withdrawn when a beneficiary no longer meets the conditions for disability or if they engage in work with revenues exceeding 1/3 of the social minimum wage.
What about combining a disability pension with a professional activity?
If a disability pensioner is still working, the income from this activity may not exceed 1/3 of the social minimum wage, otherwise the pension is withdrawn.
To find out the amount of the SSM, please consult the Social parameters.
(last updated on 16.05.2023)
What about a combination of a disability pension and an accident pension?
Where a disability pension is combined with an accident pension, the pension shall be reduced to the extent that it exceeds, when combined with the accident pension:
the average of the 5 highest annual incomes during an insurance contribution career, without this average being less than the reference amount increased by 20% (€2,993.09 per month on 1 January 2024);
the professional income used to calculate the accident pension, if this other method of calculation is more favourable.
(Last updated on 23.01.2024)
What is the administrative procedure regarding disability pensions?
How is the application submitted?
Disability pensions are granted only after a formal application 47 is submitted by the persons concerned.
The personal situation of the applicant determines the procedure to be followed in submitting the application.
If the person concerned has stopped working for health reasons, the first thing to do is to submit a declaration of illness to the National health fund (CNS). CNS grants financial compensation for sickness and seeks to establish whether someone has stopped working because of a temporary illness or whether it is a case of disability that could lead to a disability pension. To this end, a detailed medical report is requested from the doctor treating the patient. If, on the basis of this report, the Social security medical board concludes that the disability is indeed permanent, it informs the CNS, which then directs insured persons to apply to the National pension insurance fund (CNAP) for a disability pension.
If the person concerned has ceased working for some time, no financial compensation is due from the CNS. The application for a pension is made directly to CNAP. The CNAP will ask the doctor treating the person to draw up a detailed medical report.
If the disability is the result of an accident at work, not only must persons apply for a pension from the Accident insurance association (AAA), they must also apply to CNAP for a disability pension. If the disability is entirely attributable to the occupational accident, there is no need to attach a medical certificate, because the opinion of the medical examination is based on the accident file.
In the particular case of cross-border workers, an application for a pension is in principle submitted in the country in which the applicant resides. This principle is waived for insured persons who were last employed in Luxembourg and live in France, Belgium or Germany. Provided that they receive sickness benefits from a Luxembourg health fund, they may submit their application for a disability pension to the CNAP. If cross-border workers were also insured in their country of residence, CNAP will contact the competent pension institution in the country of residence in order to review pension rights in that country.
Pension review involves all the work necessary to regularise the claim submitted. The duration of this investigation depends on the availability and reliability of the basic data and can therefore vary greatly from one claim to another. If, for example, the collection of data involves complex research abroad, the processing may take several months.
Once the investigation is completed, the pension is approved or rejected by an executive decision that can be appealed.