The current year is not expected to be a grand cru for the performance of the fund in euros life insurance contracts. According to Cyrille Chartier-Kastler, founder of the site Goodvalueformoney.had, the rally is not for tomorrow but for the day after tomorrow may be… Explanation.

The Express-Seminar : The past year, the average performance of funds in euros has truly die croche e with 1.80 per cent on average. Why?

Cyrille Chartier-Kastler : The average rate used by the insurers has increased from 2.26 per cent in 2015 to 1,80 % in 2016, which is only 0.46% less. This decrease was more significant than the performance of the assets held by life insurers to manage their funds in euros ; to 3.16% on average in 2016 and 3.41% in 2015, a decrease of 0.25 % only.

This difference has an explanation : under the pressure of their authorities, the insurers were served rates reduced for investors, in order to reduce the attractiveness of their funds in euros. Recently, prudential supervision Authority and resolution (ACPR) has again asked the insurance companies to limit their collection to the fund in euro and the future rates used as of 2017. She is concerned about the current situation of low-rate (OAT 10 years located in and around 0.70 %) combined with a rise in rates to come under the leadership of central banks (including the Fed in the United States and the ECB in euro area).

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will it be the same in 2017 ?

We can expect that insurers will continue to reduce the number of rates offered. Good Value for Money anticipates an average rate of 1.48 % (net of management fees and gross of social security contributions). This evaluation is based on an assumed average yield of 2.88% of the assets constituting the fund, in euros, in decrease, therefore, of 0.28 % compared to 2016.

To counter these low points, the insurers will be tempted to dip into their reserves, still more important?

No. In 2017, they should continue to feed their “famous” provision for participation in profits (PPB) to limit the rates offered to policyholders. We estimate that 3% of this reserve of performance. In practice, this means that insurers could “dope” for 10 years the rate served on their contracts 0.30 %, by drawing simply in their PPB : it is huge!

is This scenario led to last?

No. To maintain the attractiveness of their funds in euros in 2018 and 2019, insurers will need to make savings cool to buy bonds whose performance should be better. It is then likely that they will use their SCH.

In these conditions, what can we advise current investors?

The insurance sector-life is a solid, well-managed and well-monitored. The funds in euros remains a profitable investment, even after deduction of the social contributions and inflation. Therefore, each should invest in the look of its situation and its limitations personal. Take risks by purchasing units of account means if one has some time ahead, at least 8 years. The financial markets today are high, we are no longer in a situation where the CAC 40 was below the 3,000-point mark…

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incentives to invest in the units of account multiply : is it a good thing for the performance of the fund euros?

This strategy allows insurers to reduce their capital requirements under the new standards, Solvency II, collect margins on the rear of the part of asset managers, in the form of retrocessions, and to prevent too much dilution of the financial performance of their funds in euros by buying new bonds. Once this observation is established, the real question is, if all of the units of account are always a good thing for the investor…