The context of inflation and increase in interest rates should bring the remuneration of funds in euros, the undisped supports of life insurance contracts.
per Aurélie burden
This is the final stretch for insurers who currently refine their strategy in terms of funds in euros (life insurance supports offering a capital guarantee) … After years of decline, the rate means could finally find colors in 2022.
First of all because the rise in interest rates allows them to invest in better remunerated obligations. But funds in euros are liners, and this effect will take several years before having a significant impact on yields. Insurers should nevertheless make an effort in the context of inflation. Especially since they face the increased competition of booklet A, whose rate was noted at 2 %, in August, and should further progress in February 2023.
For this, companies will be able to count on their reservations. Indeed, each year, they can choose to distribute the entire performance of the fund in euros or to put part of it, for eight years at most – it is the “provision for participation in profits” (PPB ). The Good Value For Money specialized site estimates that insurers have 71.4 billion euros in reserves at the end of 2021, the equivalent of 4.87 % yield in stock.
If insurers are reluctant to unveil their projects before the end of the year, several have already confirmed a bullish movement, including Suravenir, Apicil or BNP Paribas Cardif. “Our prudent management policy and provisions for participation in large profits will allow us to offer a fund in euros with a significant rate increase,” said Fabrice Bagne, Deputy Managing Director of BNP Paribas Cardif, French and Luxembourg manager, without advancing figure.
Rate developments will nevertheless be different from one actor to another. “This will depend on the scale of everyone’s reserves and the commercial strategy,” said Stellane Cohen, president of Altaprofits. However, we should not expect the fund in euros in the big evening. “Our various partners are considering rate hikes of around 20 cents,” reports Edouard Michot, president of the insurancevieVe.com broker.
diversification strategies
Another consequence of the rise in interest rates, insurers should be more inclined to collect savings on the fund in euros. “Within the commercial bank in France, the euro fund was 100 % accessible up to 500,000 euros and for a few weeks this amount has been deleted,” explains Fabrice Bagne. However, among the strictest insurers in this area, no announcement in this sense has yet been made.
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