The influx of life insurance is proceeding cautiously. According to figures published on Friday by France Assureurs, net inflows in life insurance amounted to €0.5 billion in September 2022, following outflows of €0.7 billion in August 2022, which marked the first outflow since September 2020, a period marked by Covid-19.
In detail, life insurance premiums reached 10.8 billion euros (-0.5 billion over a year) and benefits 10.3 billion euros (+0.6 billion over a year). During the first nine months of the year, net inflows amounted to 12.6 billion euros, a decrease of 2.5 billion euros over a year.
This positive return is driven by units of account (UA). In September, the net inflow of unit-linked units was 2.5 billion euros against an outflow of 2 billion euros for the stock in euros. Since the beginning of the year, it has been 27 billion euros for unit-linked entities (+1.3 billion euros over a year) and -14.4 billion euros for the share in euros (-3.9 billion euros over a year) .
Outflow risk
In its annual report, the High Council for Financial Stability (HCSF) justifies this dynamic with inflation: “The real exchange rate for contracts in euro funds should thus be negative in 2022 and this for the second year in a row. This situation may contribute to the continued reallocation of investments from Euro funds to unit-linked funds observed since the end of 2019, if the real return on the latter turns out to be higher” “The net outflow of Euro funds is a trend that we have observed for some time and which corresponds to a desire for diversification by savers who, in an environment where interest rates were low, are looking for a higher return expectation”, exclaims Franck Le Vallois, CEO of France Assureurs.
Faced with the increase in the remuneration of regulated savings products and the increase in interest rates, which can lead to movements in the life insurance redemption, Franck Le Vallois wants to be reassuring about the risk of outflows. “Life insurance is a long-term savings product which needs to be evaluated and evaluated in the long term and not in the short term taking into account the effects of volatility or variations observable on exogenous factors“, defends the manager.
3.5 million policyholders have a PER
In addition, in the first three quarters of the year, 275,000 life insurance contracts were transferred under the Covenants Act. Finally, total life insurance outstandings amounted to 1.808 billion euros at the end of September 2022, compared to 1.847 billion euros a year earlier.
At the same time, the pension savings scheme (PER) maintained its positive momentum. The PER market marketed by insurance companies registered 58,100 additional policyholders and 862 million euros in payments in September 2022, including 46,700 new policyholders (583 million euros in contributions) and 11,400 transfers from old contracts to a PER (279 million euros). The net inflow of PER finally amounts to 449 million euros in September and 3.9 billion euros since the beginning of the year for a total of 3.5 million policyholders with a PER and an outstanding amount of 43.4 billion euros.
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