Three good reasons to choose life insurance– Get a quote today

Life insurance, the flagship investment of the French, does it have to worry about? Looking closely at the evolution of fundraising in recent times on these savings contracts, one would certainly be tempted to think that this tax envelope has “lead in the wing”. If two years ago it attracted three-quarters of the financial savings of French households, in 2011 it only drained a quarter. A trend that clearly continued in 2012, if we are to believe the latest statistics.
It must be said that the debt crisis of the countries of the euro zone has gone through this and, with it, the serious problem of the insurance companies which have invested in sovereign bonds of this zone, the sharp drop in interest rates. reducing their sources of financial income and, as a corollary, the increase in contract buybacks.
This context, it is true anxiety, cannot however call into question the fundamental strengths of what is basically a fiscal envelope, the annual returns on the sums paid not constituting the exclusivity of the advantages of this savings, far from it. These assets are three in number.

The civil advantage of the beneficiary clause

Thanks to a life insurance contract, we can in most cases – and while taking care to preserve the rights of the heirs with reservations – transmit what you want to whoever you want, excluding inheritance tax, while retaining the enjoyment of property. And this, thanks to the beneficiary clause. Clause that is very important to write when signing the contract. “In many contracts, the beneficiary clause is reduced to a box that must be checked. This is a serious error and we are depriving ourselves of one of the major assets of life insurance, which precisely allows us to choose, thanks to an appropriate wording, the proportion of death lump sum that can go to each beneficiary ” , assures Antoine Dadvisard, Chairman of the Management Board of Matignon Finances, a portfolio management company.
Likewise, it is possible, with a judicious wording, to dismember the beneficiary clause of a life insurance contract, an operation allowing the transfer of assets over two generations, and this, with reduced taxation. The usufructuary, who will be able to enjoy the capital according to the rule of quasi-usufruct, will have the amount of capital received recorded as a liability for his future inheritance, so that on his death the bare owner (s) are not at again taxed. The restitution claim could possibly be adjusted by additional guarantees so that the bare owner (s) are certain of recovering the sums paid to the usufructuary. “We tend to see only life insurance as 'an investment product while it is also and above all a magnificent tool for transmitting wealth, ”underlines Laurent Gaillot, sales and marketing director of Cholet Dupont Partenaires.

The economic benefit of guaranteed growth

Life insurance is one of the only investments to guarantee a regular growth of its savings while allowing a wide diversification of the investments included in this envelope. “For a life insurance contract to be truly effective, we must not hesitate to keep it alive. And for that, the solutions are multiple ”, specifies Antoine Dadvisard.
And in fact, for those who feel like it, there is a very long list of opportunities likely to appeal to underwriters depending on their risk appetite. Because, next to the security pocket of the fund in euros consisting mainly of bonds, it is possible to animate that in unit-linked units where either UCITS, or direct shares, including unlisted, can be housed. other types of investments such as SCPI. “The advantage of placing SCPI in a life insurance contract is that you can acquire units at ultra-competitive prices since it is the insurer who occupies and is the custodian of them, which also ensures the liquidity of these products, which are not always easy to sell, ”explains Laurent Gaillot, who also offers his clients two contracts based on SCPIs: Euro Pierre and Euro Pierre More. A clever way to take advantage of the regularity of real estate returns (REITs deliver on average a return of 5% before social security contributions), while benefiting from the advantages of life insurance.
This means that the subscriber does not pay transfer taxes here and that by reinvesting the income, he will not pay taxes on it. “Life insurance undoubtedly makes it possible to envisage good performances, provided that one does not hesitate to be innovative. I think that in the future this savings will become more democratic to the detriment of much less flexible banking products, ”said Jean-Baptiste Lacoste, president of Orelis, a life insurance platform which thus offers a fund in euros made up of to 30% of UCITS in multi-management and which has a yield of 3.92% for 2012.

The always significant tax advantage

The tax advantages of this envelope are very numerous and were ultimately not affected by the latest finance laws, including corrective ones. Among these advantages, the possibility for any contract taken out before 70 years of age to offer an allowance of 152,500 euros per beneficiary. For contracts taken out after 70 years, the advantage is not zero either, since if only the sums originally paid are taxed with inheritance tax (less € 30,500 allowance), those resulting from savings are not. An example. A 71-year-old saver opens a contract with one million euros. After ten years, the cash value of the contract is two million. In the event of death, the taxation will only relate to one million less the 30,500 euros of abatement.
In addition, it is possible to make redemptions while benefiting from reductions for contracts taken out more than eight years ago (4,600 euros for one person, 9,200 euros for a couple). “Life insurance is thus much more interesting than a PEA, since the investment universe can go beyond European equities, it is not capped and it is easy to handle. more flexible ”, agrees Antoine Dadvisard.
As such, it is imperative to take the time to choose the contract that suits you best and to introduce the type of risk tolerated. We must also look at the entry fees which currently oscillate around 1%, without forgetting the management fees.