The French are 38 million to have life insurance. If this investment has the reputation of being risk-free, according to Nicolas Barré, director of Echoes, this guarantee could soon evolve.
The end of life insurance as we know it approaches: the authorities are thinking about a new formula for the preferred placement of the French.
The French love life insurance, and in particular contracts in euros, for a simple reason: the capital is guaranteed, it is a safe investment. To the point that the bulk of the savings of this country, 1400 billion, is the equivalent of more than half of the GDP of France, is placed in this type of contract. But the insurers who manage this savings have a problem: as the capital is guaranteed, the money must be placed in very safe products. But what is more certain is the government loans. But today, government bonds, French, German, do not pay anything since interest rates are zero or even negative. In short, managing life insurance has become an impossible equation.
Except to slightly change the rules.
This is what insurers and regulators think about. One of the ways would be to question the principle of guaranteed capital: no panic, only a very small percentage of the total would no longer be guaranteed. But that would ease the pressure on the managers. The idea is also to convince savers to accept a small amount of risk in exchange for better returns. If more of life insurance money were invested in equities rather than government bonds that yield nothing, savers would have a good chance of being better paid. And the savings of the French would also be better used: it is better to finance companies than the debt of the State. What is certain is that the days when life insurance offered a high return for zero risk are behind us. We'll have to get used to it.