The life insurance will remain it for a long time favoured by the French? Nothing is less certain, according to the CLCV. The consumer association says in a study published this Thursday, that this investment is now losing money for investors. At least in its most widespread and the most secure, that of the funds in euros. According to the CLCV, which analysed the contracts of more than 10 billion euros in loans, the rate of pay averaged 1.7% in 2018, while inflation last year was 1.8%. This means that investors have lost purchasing power.
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The loss is all the more important that this savings is subject to tax or social contributions of 17.2%. “To maintain the purchasing power of the savings after social security taxes in 2018, it was necessary to show a yield of about 2,18%,” explains François Carlier, ceo of the CLCV, in the columns of the Parisien-today in France . The interest rate, which remained at a very low level explains the lack of remuneration of the life insurance contracts. However, according to the CLCV, the insurers had the means to better protect the savings of their clients. They have a low wool called participation dividends (EPP) or provision for participation in profits (PPB), consisting of a portion of the annual profits of the fund in euros. This reserve, which represents 50 billion euros today, can offer the best remuneration in a period of very low rates. Some insurers have played the game, but not enough, says the association.
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life insurance is still very popular
“When we questioned the insurers, they tell us: ‘for the difficult years you can count on us, we will answer this’. Well then, it seems to us that it was a difficult year because with high inflation. It was therefore necessary to make an effort on performance. And they don’t make this effort”, stated François Carlier at the microphone of RTL on Thursday. “Sometimes, one wonders what they will do with this money. This is a real question and we will return it to the professionals and the regulatory authorities to make it clear”, he warns. The question of the purchasing power of savers who opened a contract of life insurance shall remain in effect to the news this year. According to experts, the year 2019 will still be marked by a low interest rate environment with an average return of funds in euros that could stabilize at 1.20% or 1.30%.
Despite these disappointing returns, the life insurance remains one of the investments more attractive to investors, reminiscent of the insurers. In comparison, the PEL does not earn more than 1%, and the liner of 0.75% (with a rate frozen at this level until 2020). The CLCV was alerted in January, on the very high loss of purchasing power of French citizens who chose to keep their savings on the livret A. In this context, life insurance is very popular. The net collection stood at 22.4 billion euros in 2018, according to the French Federation of insurance (FFA). At the end of December, the stock of life insurance contracts amounted to 1700 billion euros, up 1% year on year, with 54 million contracts and 38 million beneficiaries.
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