Are you familiar with the “growth” or “eurocroissance” funds in life insurance? Halfway between units of account and life insurance funds in euros, they offer you a guarantee on all or part of your capital but on condition that you maintain your investment for several years. Last year, their annual returns ridiculed euro funds… This year, the boomerang is back.
At the end of winter last year, interest in Eurocroissance funds suddenly increased. While euro-denominated funds vegetated in the universe of low interest rates, growth and eurocroissance funds massively posted annual performances of more than 3%.
Archives: Why eurocroissance outperforms euro funds
The upturn was short-lived. Since these funds are much more heavily invested in stock markets than traditional euro funds, some have taken the full brunt of the bad stock market year 2022. Here are the performances of the main funds, which have in common the prospect of a capital guarantee (partial or total)provided keep your investment for a minimum of 8 yearsor more according to the maturity indicated on the fund information sheet.
| Funds (and insurer) | Performance 2020 | Performance 2021 | Performance 2022 |
|---|---|---|---|
| Growth Allocation Long Term Spirica | – | 4.88% | -7.76% |
| G Growth 2014 Generali | 3.72% | 3.21% | -0.94% |
| Agipi eurocroissance Axa France | 3.10% | 3.10% | 3.30% |
| G Growth 2020 Generali | – | 3.01% | 0.05% |
| Growth Funds Axa France | 2.60% | 3% | 3.30% |
| Eurocroissance Project/Retreat BNP Paribas Cardif | 0.27% | 2.51% | -20.53% |
| Eurocroissance Heritage BNP Paribas Cardif | -1.18% | 1.30% | -13.65% |
| Afer eurocroissance Bee Insurance (formerly Aviva) | 2.42% | -0.14% | -11.38% |
Performance net of contract management fees.
Sources: communications from insurers
Long-term winning yoyo?
Launched in a difficult period, in 2014, with rates at their lowest, the family of eurocroissance funds has never been able to take off. Hope returned last year but it is now partly showered. Should we therefore bury eurocroissance? Not necessarily because, by nature, its performance (1) analyzed over the long term.
Insurers have understood this. Most have not highlighted the 2022 annual return of their eurocroissance fund, and display the annualized return over several years. At Afer, the annualized return over 5 years stands at 0.20%. Same observation for example on the side of BNP Paribas Cardif for Eurocroissance Patrimoine which falls by more than 13% in 2022 but “since its creation, in March 2012, the cumulative performance of the fund is 15.71% net of management fees. The annualized rate of return, since its creation until the end of 2022, is 1.37%”, supports the subsidiary of BNP Paribas.
“The new pillar of life insurance alongside classic euro funds and unit-linked vehicles”
One exception remains. Axa stands out with a 2022 yield of more than 3% on the Growth Fund and Agipi eurocroissance, confirming the good performance of the previous year. “Eurocroissance is asserting itself today, for our customers and our distribution networks, as the new pillar of life insurance alongside conventional euro funds and unit-linked products. The payments made by our customers have thus quintupled in 3 years to reach more than one billion euros in 2022”, says Patrick Cohen, CEO of Axa France.
Life insurance: the 2022 rate ranking, from best to worst yield
(1) For eurocroissance funds, given the particularities of certain funds, the return to be used is that communicated to you by your insurer. Namely: it obviously means before social and tax deductions.