Life insurance bounces back from a 2020 marked by the health crisis. After an outflow of 6.5 billion euros last year, inflows were positive again in April, reaching 6.4 billion euros for the first 4 months of 2021.
A positive trend since December 2020
According to the latest figures published by the Fédération française de l'assurance (French insurance federation), the trend is for life insurance to emerge from the crisis. In 2020, outflows amounted to 6.5 billion euros, due in particular to the almost total shutdown of distribution networks in the spring, and to the caution of the French, who preferred to save in their Livret A passbook accounts for greater flexibility.
For the past 5 months, the horizon has been brightening for life insurance, with a first positive net inflow of 550 million euros in December 2020, and a net inflow of 6.4 billion euros between January and April 2021.
In April alone, net inflows totaled 1.6 billion euros, with 13.1 billion euros in contributions and 11.5 billion euros in benefits paid out. Contributions doubled compared with April 2020, although the two periods are difficult to compare. On the other hand, based on April 2019, there was still an increase of 2%.
Net inflows into unit-linked products up sharply
Insurers are also delighted to note that, in April as in March, unit-linked policies accounted for 37% of total net inflows, i.e. 2.9 billion euros in April and 2.1 billion in March.
In the first 4 months of 2021, net inflows into unit-linked products totaled 10.8 billion euros, the highest level seen in over 10 years. Insurers see this as a sign of "the growing appetite of the French to diversify their savings in order to improve their long-term return expectations", says the Fédération française de l'assurance.
Insurers see this trend as contributing to economic recovery and financing. In fact, these units of account are largely invested in corporate assets, more precisely 83%, including 8% in real estate, 20% in bonds and 55% in equities.
In addition, since Tuesday June 1, thanks to a decree adopted on May 27 by Bruno Le Maire, Minister of the Economy and Finance, associative and founding securities can be included in unit-linked products.
In practical terms, policyholders will be able to use their life insurance policies to help finance foundations and associations, in line with a demand for investment diversification and a desire on the part of savers to make socially responsible investments.