Point no.1. While insurers yesterday favored their wealthy clients by serving better rates on euro funds from private (as well as wealth management) contracts, the installment policies served on euro funds have fully evolved since and they are now totally focused on the rate of units of account in exchange rates. In 2020, the interest rate gap between private management and general public savings was 15 cents (1.18% versus 1.03%) compared to 38 cents in 2017 (1.91% versus 1.53 %).
Item 2. When increasing the service rate on euro funds according to the percentage of units of account in contract rates is not a “gift” from the insurer. This is a simple refund by the insurer of a portion of the solvency margin gain provided by the units of account and the additional revenue generated by those same units of account. The average rate of return on units of account is 0.8% for the benefit of the insurer and its distributors.
Item 3. The Solvabilité II rules “torpedoed” euro funds by limiting their ability to take active risks. With the Supplementary Professional Retirement Fund (FRPS), insurers find room for maneuver in managing their funds in euros. Hence the growing demand for approval by the sector: Allianz, Aviva, Axa, CNP, Malakoff Humanis … The movement is far from over; it becomes evidence for insurers and policyholders.
Item 4. Arriving later on the market, retirement contracts (PERP, Madelin Retirement, PER …) have long served lower rates than life insurance. Women have logically reversed in recent years. Now the interest rate differential to 20 cents (0.20%) in 2020 in favor of euro pension funds. This gap should be widened over time as a result of a longer duration of the placement of euro funds in withdrawal contracts and the rise to power of the FRPS.
Item No. 5. Stacking costs on units of account leads to a global annual fee of between 2.50% and 3.00% per annum on these customer supports. If the sharp rise in financial markets, especially the stock markets, has made it possible to “hide” the total bill on units of account over the last ten years, this does not appear to be sustainable over time.
Item No. 6. Among them 5 operators that served the best rates on the market in 2020 on their euro funds, there are three associations of savers: Gaipare (at 1.90%), Asac Fapes (at 1.85%), Afer (at 1.70%) and two mutual actors: Garance (at 2 , 75%) and Mutavie (at 1.85%).
Item 7. Of the 5 operators that served rates below 0.5% in 2020, pe finds 4 significant market insurers. Yesterday’s promises are no longer what they are today.
Item No. 8. Since 2018, the average return of traditional euro funds for life insurance contracts (excluding pension contracts such as the Individual PER in particular) is between 0.15% and 0.20% above the average yield of a 10-year OAT sliding portfolio. This is consistent with the composition of traditional euro funds, which include an average of 80% bonds.
Item no. 9. An investor who pays a 3% entry fee on their life insurance payments will now have to participated for 4 to 5 years before “returning to his expenses” by investing in a euro fund, taking into account an average rate of 1% and social security contributions (17.2%). Hence the importance of attaching the saver to the level of commissions on payments. All the more so as these are not deductible from the capital gain realized or the income received.
Pbutter no. 10. The future of life insurance for the coming years lies at the crossroads of three challenges. For euro funds, it is based on a growing scale in favor of the FRPS for pension contracts (PER), a reduction in the annual capital guarantee (net of expenses) and the continuation of a superformance of installments served by the contracts of “real” associations of savers and mutual societies. For units of account, it will be a question of questioning the overly prudent financial management that does not bring anything, once the expenses have been deducted, to the insured while he assumes a share of the risk, however minimal.
The future also saw the increasing integration of index media (ETFs) into games of account units and a shift by some “classic” media operators to “clean share” media without backtracking. Finally, life insurance needs to revise its cost policy, not only for entry fees, which are far too high in a low rate context, but also for the stacking of pilot management fees and annual fees. management of courses in units of account.