The insurance prescriber site Good Value for Money, in its latest study, looked at the management costs of the units of account billed in 2023 according to the management profile (prudent, moderate or dynamic) chosen. Between 2022 and 2023, these costs generally remained stable. What to remember.
Within your life insurance contract, you have the possibility of investing your money in euro funds which are guaranteed in capital. To potentially obtain higher returns, the saver has the option of choosing to invest in units of account (UC). Depending on your contract and your insurer, you have access to different asset classes. You then have two options: choose and manage the investments yourself, or entrust management to your insurer.
In life insurance, profile management is mainly carried out according to three profiles: careful, moderate and dynamic. Each profile allows you to invest a defined portion of your savings in these famous investments with varied risks and returns. In its recently published study, Good Value For Money (GVFM) looked at the management fees inherent in each management profile. All profiles combined, the costs rise on average 1.86% for the year 2023.
2023 life insurance rates, from best to worst
The cautious profile
Current management fees are stable for this profile. They increased by 1.52% on average in 2022 1.53% this year for the heritage shares. The prudent profile implies that the majority of your savings is invested in bonds or bond or money products and very little in shares. A way to minimize risks and protect your capital by limiting losses due to stock market variations in particular.
The modr profile
The profile moderate or balanced most often means investing your capital in equal shares (50/50) between stocks and bonds. This choice promotes the balance between safety and profitability. Current management fees are up very slightly, going from 1.91 1.93% in one year.
The dynamic profile
Risk taking is higher for the dynamic or aggressive profile. By choosing this profile when taking out your life insurance, you agree to mainly invest your savings in stocks, risky and potentially profitable assets. In general, it is aimed at people wishing to invest for the long term, between 5 and 10 years. Current management fees are increasing, by exactly 6 cents. They amounted to 2.19% in 2022, against 2.25% in 2023.
Life insurance: prudent or dynamic management? Here are 5 tips to help you decide
Management fees according to different asset classes
Good Value for Money also looks at the internal management fees of the funds according to the main asset classes: shares, bonds and real estate. Find a summary of these costs here:
Asset class | Ongoing management fees Heritage shares |
---|---|
Stocks France | 2.14% |
European Stocks | 1.97% |
International Actions | 1.99% |
North America Stocks | 1.87% |
Asia Pacific Equities | 1.98% |
Emerging Country Equities | 2.11% |
BRICS stocks (Brazil, Russia, India, China, South Africa) | 2.05% |
Technologies Sector Actions | 2.02% |
Ecology/Environment Sector Actions | 1.97% |
Europe Medium Long Term Bonds | 1.02% |
International Bonds | 1.24% |
Lucky Bonds | 1.04% |
High-Yield Bonds | 1.27% |
Real estate (excluding OPCI, SCI / SC / SCP and SCPI) | 1.85% |
OPCI | 1.97% |
Chance private equity fund (FCPR) | 2.80% |
Source: Good Value For Money
Are you above these averages? To compare, you can find all these detailed costs directly in the pre-contractual information of life insurance contracts. You will find in a detailed table: the name of the management company, the gross and net performance of the asset for the previous year, the asset management fees, the total fees, the final performance and the retrocessions of product commissions (i.e. fees paid to the distributors of the contract).
Costs under surveillance
The costs thus eating into the performance of the units of account are in the sights of the Prudential Control and Resolution Authority (ACPR). The insurers’ watchdog will ensure the application of the new terms and conditions to ensure that the units of account referenced in life insurance contracts present a cost/performance ratio that is sufficiently protective of interests of customers. Thus, the possible maintenance of a unit of account in the commercial offer despite a degraded 5-year fee/performance pair will remain, in this case, limited and, qualitatively, justified.
Compare the best life insurance offers