In order to hope to achieve a more interesting return on one’s life insurance contract, it is necessary to accept to take risks by betting on units of account. However, savers do not always have the time or knowledge to manage these different media in the financial markets themselves. By choosing managed management, a professional is responsible for managing the contract in relation to the degree of risk that the saver is ready to take.
Free management, managed management, profiled management… the choice of management method for your contract life insurance multimedia is an important step. Multi-subsidy contracts show hundreds of units of account (SCPI, stocks, bonds, diversified funds, etc.), riskier but potentially more profitable support than the Eurofund with guaranteed capital. However, for an inexperienced person, it can be difficult to navigate.
Thus, while free management is more reserved for savers with solid knowledge and time to learn about the financial markets, managed management is recommended for those who want to boost their contract without worrying about it. But is it the most relevant option?
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Delegate the arbitration of your life insurance to a professional
Managed management, also called mandate management, consists of delegating all the financial operations to be carried out on your life insurance to a professional who is usually neither your insurer nor the negotiator of your contract. Generally, these are portfolio management companies (Rothschild Gestion, Lazard Frères Gestion, Carmignac, etc.). They are responsible for informing your insurance company of the funds in which the latter must invest your savings. you no longer agree to be in control of the investment choices and the distribution of your assets.
If you plan to choose managed management, you will have to define your profile : defensive, cautious, balanced, dynamic or even offensive, which can change over time. To help you make a choice based on your knowledge and goals, your insurance company will ask you to fill out a questionnaire. Depending on the risks you are ready to take, the defined profile allows for a more or less significant distribution of savings between funds in euros and funds in units of account, which are more risky.
Note that “access to managed administration depends on your insurance company and often on the amount paid on your contract. Each insurance company sets its own terms,” the news site explains. MoneyVox.
Better performance is not always guaranteed
While more and more savers choose this management method, managed management, which generates additional costs, does not always guarantee better performance.
The year 2021 has actually seen returns over 20% for the best contracts in offensive profile. An exceptional return compared to the funds in euros, of 1.30% on average in the same year.
Nevertheless, most of the dynamic or offensive profiles developed rather between 10% and 20% during 2021. As for the moderate or balanced profiles, the returns were around 5% to 8%. Finally, the return for very defensive profiles was below 2%. Concretely, performance depends primarily on the chosen profile and the state of the financial markets in the long term.
Savers usually rely on the performance of the CAC 40 to measure the performance of their contracts. After a slight drop of 7% in 2020, the latter regained ground in 2021 with +28.85%. “In this context, a look at 2020’s performance is rich in lessons: it makes it possible to point to the contracts that have performed better against headwinds. Thus, in order to judge a managed management, it is always necessary to try to look at the performance over several years, and not just the photograph from the previous year”, explains MoneyVox.
A tip to take into account again for this year 2022 marked by strong tremors in the financial markets. In particular, the CAC 40 has fallen by more than 10% since the start of the year. Faced with this situation, controlled management should not be seen as a miracle solution.
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