Insurers are increasingly pushing depositors to diversify their investments: subsidized rates, no commissions, payout limits… Life insurance specialists are stepping up initiatives to limit investments in euro funds. So can we invest 100% in a guaranteed fund today?
By subscribing to life insurance, the saver has the opportunity to invest his money in the long term so that it grows. But he doesn’t necessarily want to take risks to invest in Units of Account (UA). These non-guaranteed investments, because they are subject to market fluctuations but are potentially more profitable, are becoming increasingly popular in life insurance contracts. The share of unit-related contributions reached 39% in 2021 and 40% in the first quarter of 2022, according to France Assureurs.
Insurers push for diversification
Logics? Inflation reached in June 5.8%, within one year, and the return on euro funds is now largely stable, just above 1%. Under these circumstances, the decision to invest some of your life insurance in UC seems like a legitimate one to try and improve your performance.
Life insurance: what units of account to choose to beat inflation?
But if units of account have become a hit, it is not only because savers are adapting to the economic situation. Insurers are also pushing for diversification. To avoid massive injections into the Eurofund, whose capital is guaranteed, some insurers set the share of investments in units of account. Over the years, the requirement for savers to invest part of their savings in UC has even become the norm.
However, some savers remain wary of the risk of losses associated with mutual investments. And if you expect a major life insurance phase-out in the medium term, you might want to be careful with 100% euro funds.
What life insurance contracts today still allow 100% investment in funds in euros ? Contrary to what the prevailing discourse suggests, many contracts still allow you to bet in the fund in euros. Even if the insurers and distributors concerned don’t necessarily emphasize it. Here is a partial list of these contracts.
These are contracts where you can pay 100% to the fund in euros
|Treaty||Insurer||Payment commission||2021 performance|
|Boursorama Vie (Exclusive Eurofund)||generals||0%||1.35%|
|Swisslife total assets||Swisslife||0%||0.80%|
|Monabanq Life Premium (Eurossima Foundation)||generals||0%||0.75%|
|Power Selection (Eurossima Foundation)||generals||0%||0.80%|
|We are preserving the heritage||Surfture||0%||1.30%|
Contracts With payment fees
|Future Free Savings Account||MYTH||2%||1.70%|
|Savings Guarantor||Madder||3% max||2.75%|
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Consider the level of payment commissions
This table categorizes contracts with or without commission on payment. Why ? because the issue of deposit fees is even greater if you bet exclusively on a fund in euros. Example: You invest 1000 euros in a fund in euros with a deposit fee of 2%. Only 980 euros are actually invested after commissions have been charged. With the current reward of funds in euros, it will take you at least 2 years for your savings to return to 1000 euros and for the contract to finally start multiplying your savings.
Life insurance: 2 years of lost profits due to commissions!
Payment fees also sometimes differ depending on the media selected under the same contract. Mutual fund life insurance, for example, sets the price 2% (of the investment amount) to the fund in euros, but does not charge a deposit fee for units of account.
Without UC… non-refundable bonus for the fund in euros
Insurers often use another method to encourage you to bet on UC: the yield bonus. Your fund’s return in euros increases depending on the proportion of your savings invested in mutual funds. Mention may be made, in particular, of the Allianz Multi Savings Lifewhich in 2021 offers an average return of 0.88% on its expanded fund in euros up to 1.19%. Same with contract. Arpeggio Axa which offers a performance of 0.90% up to 1.35% in 2021 according to the share invested in units of account. Again, here’s what to keep in mind if you’re aiming for a 100% fund contract in euros.
2022 ranking of life insurance fund rates for 2021 in euros
Invest in a fund in euros, yes… But not too much
The rest of the contracts are still available for payments only for the fund in euros… But under certain conditions. To benefit from this without investing your savings in units of account, you do not need to exceed a certain amount investment.
|Treaty||Insurer||Payment commission||Terms||2021 performance|
|evolution of life||Bee Insurance||0%||Payments of 100% funds in euros possible up to 30,000 euros (in addition, a minimum investment of 30% in UC)||1.31%|
|monivan||generals||2%||100% available up to €50,000 per calendar year of membership, then €25,000 per calendar year in subsequent years.||1.70%|
Euro croissant alternative
Created in 2014, the Eurocroissant fund is another alternative offered by insurers. How does it differ from the classical Eurofund? Capital is guaranteed only after a predetermined period (minimum 8 years).
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