Life insurance rates for 2022 are up sharply. But beware: banks and insurers use stratagems in their communication to amplify the improvement in their remuneration. Explanations.
The 2022 life insurance rate season is in full swing. Good news: after years of plummeting, reported yields are almost all up, often above the threshold of 2% net of management fees and gross of social contributions. The regularly announced death of euro funds is therefore not for now.
On the contrary, this risk-free medium is rising from its ashes, driven in particular by the rise in the Livret A rate, the remuneration of which rose in 2022 from 0.5% 2% and who will climb 3% from February 1, 2023. To prevent savers from turning away from euro funds, market players have been forced to react. This is particularly the case of the large banks whose contract remuneration is often the lowest.
Banks: unexpected increases
As proof, the Crdit Mutuel Alliance Fdrale group has revealed an unexpected increase in yield of 1 point or more for certain savers: 2.10% for the Essential version of the Plan Assurance Vie flagship contract. And even 2.25% for the Privilege version. Another illustration with LCL Vie, the gondola end of LCL contracts. The compensation ranges from 2.30% 3.10% on its euro fund for 2022, against 1.05% 1.85% for 2021.
| Banks | Flagship contract | Rates 2021 | Max bonus 2021 | Rates 2022 | Max bonus 2022 |
|---|---|---|---|---|---|
| People’s Bank | Horizon 2 | 0.75% | 1.10% | – | – |
| BNP Paribas | BNP Paribas Multiinvestments | 1.10% | 1.65% | 2% | 2.95% |
| Savings Bank | Millevie Essential 2 | 0.75% | – | – | – |
| CIC | Essential Life Insurance Plan | 1.10% | 1.60% | 2.10% | 2.75% |
| Credit Agricole | Predissime 9 series 2 | 0.65% | 1.45% | 1.90% | 2.70% |
| Credit du Nord | Antarius Selection | 0.90% | 1.35% | – | – |
| Mutual Credit | Essential Life Insurance Plan | 1.10% | 1.60% | 2.10% | 2.75% |
| Credit Mutuel Arka | Navig’Options | 0.85% | 1.20% | – | – |
| The postal bank | Cashmere 2 Series 2 | – | – | 1.40% | 2.80% |
| LCL | LCL Life | 1.05% | 1.85% | 2.30% * | 3.10% * |
| Societe Generale | Essential Maple and Squoia | 0.75% | 1.84% | 1.95% (average rate) | – |
Société Générale communicates an average rate, and not a base rate, which makes any comparison impossible with the contracts of other brands.
* Rate for 0.60% management fees, these fees varying according to the contracts.
This table will be updated as announcements are made.
Life insurance: Crdit Agricole, Crdit Mutuel… astonishing rebounds for 2022 bank rates
Average rates that hide the reality of small contracts
But this good news is not the only surprises of this 2022 interest rate season. Some banks are showing a certain creativity in their communication.
This is the case, for example, for Sogcap, the life insurance company of Société Générale. She announced a return of 2.17% on its support in euros, all contracts combined, up sharply by 0.81 points compared to 2021.
Life insurance: the 2022 rate ranking, from best to worst yield
But behind this increase hides a subtlety. Sogcap only communicates this year on average rates. Indeed, the policyholders benefit from a double yield bonus on the euro fund: on the one hand according to the part they invest in the units of account, the risky life insurance funds, on the other hand depending on the size of the sums saved. Last year, Sogcap’s average rate was therefore 1.32% but, on Squoia, the remuneration paid varied from 0.75% to 1.84% depending on the risk appetite and the size of the client’s portfolio. This year, for the 2022 remuneration paid at the start of 2023, the same flagship contract of the red and black bank, Squoia, thus sees its average yield increase by 0.89 points to 1.95%.
For which basic rate, the minimum paid to the insured? Despite insistent reminders from MoneyVox, the red and black bank refuses to reveal the base rate of the euro fund, as usual, making it more difficult to compare with its competitors. Socit Generale does not communicate either (for the time being?) the yield provided on Erable Essentiel, its entry-level contract that its advisors therefore offer to customers new to life insurance.
Societe Generale is not the only brand to favor the communication of the average rate. The insurer Allianz is also familiar with the fact, but Allianz nevertheless agreed to reveal its minimum rate (1.73%) on Allianz Vie Fidlit, the average being 2.12% and the maximum of 2.12% .
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Increasing performance bonuses
Last year, Societe Generale converted to the performance bonus, a system that rewards – via the return on the fund in euros – customers who agree to take on more risk by investing in units of account. Once the prerogative of a handful of insurers, the practice of bonuses is becoming widespread. On the side of the big banks, Socit Gnrale but also La Banque Postale, Crdit Mutuel, CIC, BNP Paribas and Crdit Agricole thus cause the fund’s return to vary in euros, with variable criteria.
Result: the pay gap between two contracts with the same name is sometimes huge. This is the case at Credit Agricole Insurance: holders of the Predissime 9 series 2 general public contract will benefit from a return on the euro fund of 1.90% if the share invested in units of account is less than 25%: a huge jump compared to the 0.65% of last year! But this rate passes 2.70% for those who have more than 50% unit-linked in their contract.
The postal bank and its insurer CNP put forward a remuneration of up to 2.80% on the new Cachemire 2 Serie 2 contract, but the base rate is only 1.40%… A minimum remuneration which concerns customers having less than 25% of their savings in units of account (UA). As this new contract is based on pilot management, many policyholders have more than 25% UC… but the 2022 rate is only 1.75% if you have less than half of your savings invested in CPU.
Variable geometry management fees
Another point to watch out for when yield announcements are made: management fees. Some insurers do not apply the same level of fees on contracts that are however alike as two drops of water: management fees can change from one broker to another, or sometimes quite simply from one client to another!
This is the case at Crdit Agricole: for these Floriane 2 and Ana contracts, the rates displayed are only valid for contracts for which management fees of 0.60%. Indeed, some contracts have higher management fees, with the key to lower net returns, as noted by vigilant MoneyVox forumers.
Ditto for LCL contracts which are also insured by Prdica, a subsidiary of Crdit Agricole SA. The remuneration of 2.30% 3.10% poster for LCL Vie is only worth 0.60% management fees.
Funds with sometimes unexpected constraints
Finally, the announcement of a very generous rate should not make you forget that certain funds in euros have a specific function. At Allianz, the euro fund of the very recent Allianz Vie Fidlit contract can certainly bring you up to 3.17% in 2022, but you have to agree not to withdraw your money for 5 years.
One example among others (investment possible once a year, payment limited according to the unit share, etc.), as the conditions of access to certain funds in euros are sometimes covered by the assembly instructions for a kit of furniture expert level.
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