Inflation will weigh heavily on life insurance


The first 2021 yields announced this week certainly mark a rebound (2.1% for MACSF) or stability (from 0.75% to 1.84% for Societe Generale), but they should decline overall (as for La France Mutualiste: from 1.31% to 2%). The average rate of revaluation of funds in euros, the secure supports of the contracts, could be established between 1% and 1.2% “, according to Philippe Crevel, the director of the Circle of savings, against 1.28% in 2020.

With inflation at 2.8%, according to provisional data from INSEE, for 2021, you don’t have to be strong in math to understand that the account will not be there, even with the best. ” The actual return [net d’inflation] will be negative », continues Philippe Crevel. If we put the operation, it gives – 1.7% in 2021 or so, and again, it is without taxation. In the best case, i.e. for a contract of more than eight years and within the limit of €4,600 of repurchased capital gains (€9,200 for a couple), the saver will still have to pay social contributions, up to 17.2% on what he earned.

Inflation will weigh heavily on life insurance
Inflation will weigh heavily on life insurance | Photo credits: Invest

Life insurance holders, aware that risk-free investments will no longer yield as much as before, have already begun to direct their savings to the markets, by subscribing to units of account (UC) present in the contracts ( such as UCITS, SCPI, ETF, etc.). The share of unit-linked payments has thus increased, to reach 38%, from January to November 2021. It must be said that savers do not have much choice, because more and more insurers impose only a fraction (30 % in general) of each installment is directed towards CUs. The policyholders are then free to repatriate the money to the fund in euros, but this is not very common. ” The French are used to taking a little more risk, and this is not prohibitive for fundraising », remarks Philippe Crevel again.

Return from collection

An opinion shared by Gilles Belloir, the president of Placement-direct: “ 2021 marks the return of collection. The market has returned to levels similar to, or even higher than, pre-crisis levels. “Savers thus contributed significant sums to their contracts: 136.7 billion euros, from January to November 2021, up 33.2 billion compared to the same period in 2020. “ It’s been a great year for online brokers “, welcomes Gilles Belloir, who claims an increase of about 50% in contributions.

Subscribers also paid in more money than they withdrew: net inflow amounted to 21 billion euros, while it was negative in 2020.

If it has not caught up with its 2019 level, this is however the case for UC alone, which even exceeded it by 84%! Funds in euros are experiencing, conversely, outflows. The latter could nevertheless benefit from the rise in bond rates in the coming years. “ In the long term, it is favorable to funds in euros because they are heavily invested in government bonds, explains Gilles Belloir. But it will never be enough to cover inflation in 2021. »

The Livret A rate was already suffering from this defect, but it should soon increase. The performance of funds in euros could well end up meeting it, and life insurance will then only have its significant estate deductions and the absence of outstanding limits as competitive advantages on the secure investment market.




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