The amounts placed in the Eurocromence, a product without guarantee of day-to-day capital, grew by 37% in 2021. But they remain anecdotal compared to the overall outstanding life insurance. Only two big actors today focus on these supports.
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Would the transplant take it? The outstanding amounts of the Eurocromence Life Insurance funds grew by 37% from 2020 to 2021 from 3.3 billion euros to 4.6 billion euros, according to France insurers (former French Federation of the insurance).
Launched in 2014, the Eurocromence was designed by the Treasury as a third way, halfway between the funds in euros and the units of account – the two types of traditional media via which in invest in life insurance . The major characteristic of the first? Capital is guaranteed, day-to-day. That of the seconds? Their performance potential.
To join these two worlds, the Eurocromence is a product with a capital guarantee, but only after a period of between eight and forty years, at the option of the insured. In the meantime, the value of savings can fluctuate.
Other peculiarity: ultimately, the warranty is either total or partial. By loosening the warranty, the Eurocromence allows the insurer to invest more dynamically and thus generate better performance.
Gas plant originally
But at the origin, the Eurocromence was an incredible gas plant, for investors and insurers. Nobody really knew how much these products reported both the calculations were sophisticated. The Covenant Act (Action Plan for Business Transformation and Business Transformation, voted in 2019) has undertaken to simplify theuchoise. Now, these brackets look more like a conventional account unit, with a value that is changing regularly. And insurers can communicate on an average annual rate of return, which facilitates comparisons.
Despite this facelift, theuchoise still represents only a drop of water: at the end of 2021, it weighed less than 0.25% of the € 1,876 billion invested in life insurance (73% of the ‘outstandings are in funds in euros).
How to explain this fiasco? Investors remain loyal to the fund in euros, despite its decline yield (1,30% on average in 2021, according to France insurers). In parallel, professionals have developed a lot of account units, by integrating real estate supports, structured products and other funds with a limited level of risk, to attract investors. What to compete with theuchoise.
Other element of explanation: The insurers themselves have not believed. Companies that have developed such a product are counted on the fingers of one hand. Currently, two main actors bet on this support: AXA and Generali.
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