In April 2021 the Share of payments on unit-linked (UA) media exploded: it was 37%! It therefore appears that UCs, which are more profitable than funds in euros, increasingly attractive for French savers. And that shouldn’t displease life insurers.
Increasingly popular units of account (UC)
37% of UC payments in life insurance in April 2021 it is almost four times more than ten years ago, when it made up only 10% of the contributions! But what are CUs? They are riskier vehicles than Euro funds, however much more profitable. While euro funds are mostly invested and guaranteed in government bonds, CUs expose themselves Holdings, Real estate or corporate bonds. Thus, your capital is not guaranteed, but your return is potentially much higher.
For April 2021, the French invested a total of 13.1 billion euros in life insurance. The UC investments According to the FFA (French Insurance Association), this corresponds to 4.8 billion euros for this period.
Insurers are pushing savers to focus on these more profitable supports
But why are the French moving more towards these risky investments? The answer is actually quite simple: Returns from euro funds have become almost zero. For the year 2020, the average fund return in euros was 1.30% less management fees. In 2020, CUs reported only 0.3% due to the Covid-19 health and economic crisis. But between January 2021 and April 2021, UCs had a performance of 4.3%. And you have to remember that life insurance is one Long term investment. A single year is therefore not representative of the return on an investment.
Thus, CUs continue to gain ground. UC now accounts for 23% of the approximately € 1,800 billion in outstanding life insurance. Since the beginning of the year, 83% of CUs have been subscribed to in corporate assets, 55% of which in stocks, 20% in bonds and 8% in real estate.
It must be said that insurers are increasingly pushing savers for this support. Because if the French move more and more towards UC, they will stay Beware of risky investments. Therefore, insurers sometimes take certain incentives B. by improving the fund return in euros according to the UA rate signed in the life insurance contract. Others opt for restrictive measures and do not prevent, for example, the conclusion of a contract that consists of 100% funds in euros.
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