French life insurance recorded another month of outflow in September, the seventh in a row, bringing to more than seven billion euros net the funds withdrawn since the beginning of the year from this flagship investment in France.
In September, French savers deposited 9.4 billion on their life insurance contracts, when the sums withdrawn reached 10.2 billion euros, according to provisional figures released Thursday by the French Insurance Federation.
In doing so, the month of September ended with a negative net inflow, or outflow, of around 800 million euros, while the French life insurance sector had harvested nearly 3 billion euros on the same month in 2019.
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September marks the seventh month of outflows in a row for life insurance, which has not seen a single month of positive net inflows since March, or since the explosion of the Covid-19 pandemic, containment and administrative closures of shops.
“
The French are currently favoring savings solutions that are more easily mobilized,
” commented the insurance federation in a press release.
Favored units of account
The contrast is striking with the Livret A. This investment, whose funds are guaranteed, exempt from tax and available at any time, achieved a net inflow of more than 25 billion euros between January and September.
In comparison, the French life insurance sector suffered a net outflow of 7.3 billion euros in the first nine months of the year.
"
Nevertheless, policyholders who take out new life insurance contracts or who supplement their existing contracts continue to invest in unit-linked media
", more risky, but potentially more profitable, underlines the federation.
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Very popular with savers a few years ago, investment vehicles in "
euros
", the capital of which is guaranteed, are less and less profitable in a context of very low or even negative rates.
For insurers, it is also becoming more difficult to guarantee returns to policyholders and companies are in any case seeking to reduce in their portfolios the share of these contracts, which are very costly in regulatory capital.
The sector now favors so-called “
unit-linked
” investments, the name of these riskier investments - the capital is not guaranteed - but potentially more profitable and less demanding in terms of regulatory capital for companies.
During the first nine months of the year, payments to unit-linked vehicles thus represented 28.1 billion euros, or 34% of contributions.
Over this period in 2019, this share was slightly less than 30%.
